'i'MMliHlijiiMiHlllhtiliiHiiilii Wife LIBRARY OF THE Theological Seminary, i PRINCETON, N. J. a Case, . XJ Shelf, . ,Av, . . $ Hook, I . Digitized by the Internet Archive in 2017 with funding from Princeton Theological Seminary Library https://archive.org/details/collectedworksof09unse_0 THE COLLECTED WORKS OF DUGALD STEWART. VOL. IX. a * ' COLLECTED WORKS OK / DUGALD STEWART, ESQ., F.R.SS. HONORARY MEMBER OF THE IMPERIAL ACADEMY OF SCIENCES AT ST. PETERSBURG! ; MEMBER OF THE ROYAL ACADEMIES OF BERLIN AND OF NAPLES ) OF THE AMERICAN SOCIETIES OF PHILADELPHIA AND OF BOSTON ; HONORARY MEMBER OF THE PHILOSOPHICAL SOCIETY OF CAMBRIDGE ; PROFESSOR OF MORAL PHILOSOPHY IN THE UNIVERSITY OF EDINBURGH. EDITED BY SIR WILLIAM HAMILTON, BART. advocate; A.1M. (OXON.) ; ETC. ; CORRESPONDING member of the institute OF FRANCE; HONORARY MEMBER OF THE AMERICAN ACADEMY OF ARTS AND SCIENCES; AND OF THE LATIN SOCIETY OF JENA ; ETC. ; PROFESSOR OF LOGIC AND METAPHYSICS IN THE UNIVERSITY OF EDINBURGH. VOL. IX EDINBURGH: THOMAS CONSTABLE AND CO. LITTLE, BROWN, AND CO., BOSTON, U.S. MDCCCLVI. KDINBTJKGB : T CONSTABLE, PRINTER TO HER MAJESTY. LECTURES ON POLITICAL ECONOMY. HOW FIRST PUBLISHED. VOL. II. TO WHICH IS PREFIXED, P A R T T H 1 II I) OF THE OUTLINES OF MORAL PHILOSOPHY. DUG A LI) STEWART, ESQ. EDITED BY SIR WILLIAM HAMILTON, BART. EDINBURGH: THOMAS CONSTABLE AND CO. LITTLE, BROWN, AND CO., BOSTON, U.S. MDCCCLVI. . V m ■ O'" * CONTENTS. LECTURES ON POLITICAL ECONOMY. PART FIRST.— OF POLITICAL ECONOMY PROPER. (Continued.) BOOK SECOND. OF NATIONAL WE ALT II.— (Continued.) CHAPTER III. Page Or Trade, ........ 3 Sect, i — Of the Freedom of Trade, . .... 3 Subsect. 1. Of Restraints on Domestic Commerce and Industry, 5 Subsect. 2. Of Restraints on the Commercial Intercourse of Different Nations, . . . .22 Sect. ii. — Of the Corn Trade, ...... 47 Subsect. 1. — Of the Inland Corn Trade, ... 48 Subsect. 2. — Of the Trade carried on by the Merchant Im¬ porter of Grain for Home Consumption, . 100 Subsect. 3. — Of the Trade carried on by the Merchant Ex¬ porter of Grain for Foreign Consumption, . 110 Subsect. 4. — Of the Trade of the Merchant Carrier, or Im¬ porter of Corn for future Exportation, . 120 Subsect. 5. — Miscellaneous Observations upon the Com Trade, 121 Sect. iii. — On subjecting the Commerce of Money to the Regulation of Law, 146 Sect. iv. — On subjecting the Commerce of Land to the Regulation of Law, 195 CHAPTER IV. Of Taxes, ........ 211 Sect. i. — Of Taxes in General — Lntroductory, . . . 211 Sect. ii. — Of Taxes upon Land , ..... 225 Subsect. 1. — Of Taxes upon the Rent of Land, . . 225 1. ) — According to a Fixed Canon, . . 225 2. ) — According to the Varying Rent, . . 234 Subsect. 2. — Of Taxes which are proportioned, not to the Rent, but to the Produce of Land, . . .243 Sect. iii. — Of Taxes upon the Rent of Houses, .... 247 VI 11 CONTENTS. Page Sect. iv. — Of Taxes upon Profit, or upon the Revenue arising from Stock, 249 Subsect. 1. — Of Taxes upon Profit in General, . . 249 Subsect. 2. — Of Taxes upon the Profit of Particular Employments, 250 Sect. v. — Conclusion , ....... 251 BOOK THIRD. OF THE POOR — THEIR MAINTENANCE. CHAPTER I. Historical Sketch of the British Poor-Laws, . . . 254 Sect. i. — Of the English Poor-Laivs, ..... 254 Sect. ii. — Of the Scottish Poor-Laws, ..... 286 CHAPTER II. Of Subsidiary Measures for the Relief of the Poor, . . 300 Sect. i. — Of Charity Workhouses, ..... 300 Sect. ii. — Of Benefit Clubs or Friendly Societies, . . . 306 Sect. iii. — Of the Distresses of the Poor, in so far as they proceed from their own Evil Habits , . . . . .313 BOOK FOURTH. OF THE EDUCATION OF THE LOWER ORDERS, . . 327 PART SECOND.— OF POLITICS PROPER, OR THEORY OF GOVERNMENT. CHAPTER I. Of the Simple Forms of Government, . . . . 351 Sect. i. — Introduction, ...... 351 Subsect. 1. — Of tlie Legislative, Judicial and Executive Powers, 351 Subsect. 2. — Of tlie Simple Forms of Government, in Theory and in General, .... 352 Sect. ii. — Of the Simple Forms of Government, in Special , . . 355 Subsect. 1. — Of Democracy and Democratic States, . 355 Subsect. 2. — Of Aristocracy, . . . . 376 Subsect. 3. — Of Monarchy, .... 386 CHAPTER II. Of Mixed Governments, ...... 402 Sect. i. — Of Mixed Governments , in General, . . . 402 Sect. ii. — Of Mixed Governments, in Special and particularly of the English Constitution, . . . . . 424 Appendices to Parts First and Second. App. I., Quotation from Howlett on the Exportation of Grain, 457 App. II., A Conclusion to the first Three Books of Political Eco¬ nomy — strictly so called, .... 458 App. III., An earlier Conclusion to Politics Proper, . . 459 Index, . . . . . . . 463 LECTURES ON POLITICAL ECONOMY. VOL. IX. A LECTURES ON POLITICAL ECONOMY. [CONTINUATION OF BOOK SECOND.] [OF NATIONAL WEALTH.] [CHAPTEK III] [OF TRADE.] SECT. I.* — OF THE FREEDOM OF TRADE. ( Interpolation from Notes.) — I now proceed to trace, in as few words as possible, the outline of that practical doctrine, concerning the freedom of trade , which it was the great scope of Mr. Smith’s work to establish ; combining together, in one point of view, various speculations, which his comprehensive plan necessarily led him to state under different titles. I have observed, in mj Account of the Life and Writings of Mr „ Smith , “ that the great and leading object of Mr. Smith’s speculations is to illustrate the provision made by nature in the principles of the human mind, and, in the circumstances of man’s external situation, for a gradual and progressive augmen¬ tation in the means of national wealth, and to demonstrate, that the most effectual plan for advancing a people to greatness, is to maintain that order of things which nature has pointed out, by allowing every man, as long as he observes the rules of justice, to pursue his own interest in his own way, and to bring both his industry and his capital into the freest competition with those of his fellow-citizens. 4 POLITICAL ECONOMY. — PART I. — BOOK II. NAT. WEALTH. “ Every system of policy which endeavours, either by extra¬ ordinary encouragements to draw towards a particular species of industry a greater share of the capital of the society than what would naturally go to it, or, by extraordinary restraints, to force from a particular species of industry some share of the capital which would otherwise be employed in it, is, in reality, subversive of the great purpose which it means to promote. “ What the circumstances are, which, in modern Europe, have contributed to disturb this order of nature, and, in par¬ ticular, to encourage the industry of towns, at the expense of that of the country, Mr. Smith has investigated with great in¬ genuity, and in such a manner as to throw much new light on the history of that state of society which prevails in this quarter of the globe. His observations on this subject tend to shew, that these circumstances were, in their first origin, the natural and the unavoidable result of the peculiar situation of mankind during a certain period ; and that they took their rise, not from any general scheme of policy, but from the private interests and prejudices of particular orders of men. 6C The state of society, however, which at first arose from a singular combination of accidents, has been prolonged much beyond its natural period, by a false system of Political Economy, propagated by merchants and manufacturers ; a class of indi¬ viduals whose interest is not always the same with that of the public, and whose professional knowledge gave them many advantages, more particularly in the infancy of this branch of science, in defending those opinions which they wished to encourage. By means of this system, a new set of obstacles to the progress of national prosperity has been created. Those which arose from the disorders of the feudal ages, tended directly to disturb the internal arrangements of society, by obstructing the free circulation of labour and of stock, from employment to employment, and from place to place. The false system of Political Economy which has been hitherto pre¬ valent, as its professed object has been to regulate the commer¬ cial intercourse between different nations, has produced its CHAP. III. — OF TRADE. (§ 1.) 5 effect in a way less direct and less manifest, but equally pre¬ judicial to the states that have adopted it.”* According to this view of the subject, the doctrine of the freedom of trade appears to me to divide itself naturally into two articles. The one relates to those restraints which check the free circulation of labour and stock among the members of the same community, the other, to the restraints on the com¬ mercial intercourse of different nations. I shall consider these two articles separately, beginning with the restraints on domestic commerce. What I have to offer on this subject, I must again remind you, will be little more than an abridgment of Mr. Smith's argument, which, indeed, it is absolutely necessary to introduce in order to prepare the way for the discussions which still remain. [subsect, i .-—Of Restraints on Domestic Commerce and Industry .] I had occasion before to mention Mr. Smith's analysis of the component parts of the price of commodities. f The same author observes, that “ as the price or exchangeable value of every particular commodity, taken separately, resolves itself into some one or other, or all of those three parts ; so that of all the commodities which compose the whole annual produce of the labour of every country, taken complexly, must resolve itself into the same three parts, and be parcelled out among different inhabitants of the country, either as the wages of their labour, the profits of their stock, or the rent of their land . “ When those three different sorts of revenue belong to dif¬ ferent persons, they are readily distinguished ; but when they belong to the same, they are sometimes confounded with one another, at least in common language. “ A gentleman who farms a part of his own estate, after paying the expense of cultivation, should gain both the rent of the landlord and the profit of the farmer. He is apt to deno- * [Sect, iv., infra , Yol. X. pp. GO, 61.] f (See above, Political Economy, Yol. I. ( Works, Yol. VIII.) p. 391.) 6 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. * inmate, however, his whole gain profit, and thus confounds rent with profit, at least in common language.”* In some of Mr. Smith’s illustrations of this subject, there are principles involved which have a connexion with those defini¬ tions of national wealth and of productive labour, on which I formerly hazarded some criticisms. But to these it is not necessary for me to attend at present. Nor, perhaps, will it be possible for me to avoid some other peculiarities of expression connected with his system, which I should not voluntarily have adopted if I had followed the train of my own thoughts in stating the doctrines now to be explained. I cannot help add¬ ing, that the result of Mr. Smith’s speculations respecting the component parts of price , although sufficiently accurate for our present purpose, is by no means unexceptionable in point of distinctness. It appears from a manuscript of Mr. Smith’s, now in my possession, that the foregoing analysis or division was suggested to him by Mr. Oswald of Dunnikier. It is somewhat remark¬ able, that the very same division is hinted at by Sir William Petty, who states it as an impediment to national prosperity, that taxes should be levied on lands alone, and not on land, stock, and labour. In the very slight view of the subject to which I am obliged to confine my attention, I shall have little or no occasion to touch on the rent of land , the political regulations I have in view tending chiefly to affect wages and profit in the different employments of labour and stock. In order to convey a distinct idea of the manner in which these regulations operate, it is necessary for me to premise a few other general considerations, in addition to those which have been already suggested. It is necessary, in particular, for me to give a short recapitulation of Mr. Smith’s doctrines concerning the natural price of commodi¬ ties : as distinguished from that which they actually bear in the market. Some of these principles I have had occasion to state already ; but they are so intimately connected with the subject now in view, that I shall again recall them to your attention. * [ Wealth of Nations, Book I. chap. vi. ; Yol. I. p. 78, seq., tenth edition.] CHAP. III. — OF TRADE. (§ 1.) 7 £c When the price of any commodity is neither more nor less than what is sufficient to pay the rent of the land, the wages of the labour, and the profits of the stock employed in raising, preparing, and bringing it to market, according to their natural rates, the commodity is then sold for what may be called its natural price.”* This is frequently different from the market price , which depends upon the proportion which is actually brought to market, and the extent of the demand. With respect to the market price of commodities, it is very justly observed by Mr. Thornton, that “ it is formed by means of a certain struggle which takes place between the buyers and the sellers. It is commonly said, that the price of a thing is regulated by the proportion between the supply and the demand. This is, undoubtedly, true ; and for the following reason : — If the supply of an article, or the demand for it, is great, it is also known to be great ; and if small, it is understood to be small. When, therefore, the supply, for example, is known to be less than the demand, the sellers judge that the buyers are in some degree in their mercy, and they insist on as favourable a price as their power over the buyers is likely to enable them to obtain. The price paid is not at all governed by the equity of the case, but entirely by the degree of command which the one party has over the other. When the demand is less than the supply, the buyers, in their turn, in some degree, command the market, giving not that sum which is calculated to indemnify the seller against loss, but so much only as they think that the seller will accept rather than not sell his article. The question of price is, therefore, in all cases, a question of power, and of power only. It is obvious, that a rise in the price of a scarce com¬ modity, will be more or less considerable in proportion as the article is felt to be one of more or less strict necessity. Of this remark of Mr. Thornton s, a very striking illustration is afforded by our immense importations from the north of * [ Wealth of Nations, Book I. clmp. f [Inquiry into the Nature and Effect 'vii. ; Yol. I. p. 82, tenth edition.] of the Paper Credit of Great Britain , Chap. viii. p. 193, seffi 8 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. Europe ; importations occasioned chiefly by the great difference in the value of money in this country, and in these nations ; in consequence of which, they have it always in their power so to suit their prices to our market, as to keep them below that at which we can produce the same articles ourselves. It frequently happens, that avarice counteracts this state of things, in some instances to a great degree, and to a certain degree in all. Thus, for example, we can supply ourselves with iron at as cheap a rate as the Swedes and Russians now are disposed to do it, but not at so low a price as they might sell it. Had they been disposed to extend the iron trade, instead of demanding the highest prices which they could get, we should never have made the progress we have made in this very important article of manufacture. The price, in fact, of every article which we purchase from the north, is regulated by the price which the same article could be raised at in England, and not according to what Mr. Smith calls the natural price. Thus, we are as¬ sured by the best authorities, that the tallow and hides which come into the English market, are sold for above three times the natural proportion which they should bear to the price of that part of the beast which is consumed in Russia. According to the principles which have been seen to regulate the natural price of commodities, the pound of tallow should not be sold at a higher price than the pound of meat ; whereas, in Russia, it is sold at more than ten, and even fifteen times that price. This, however, it is added, was not the case till the exportation of tallow to England became general. My reason for entering here into this detail, was the illustra¬ tion it affords of the difference between the principles which regulate the natural and the market prices of commodities. Among the articles imported from Russia, there are very few which we cannot produce ourselves ; but the fact is, that the value of money is so different in the two countries, that what¬ ever is brought to this market becomes too dear for their own consumption. A Russian peasant, accordingly, although sup¬ plied with abundance of animal food, is not able to afford to burn a candle ; while we find that the English peasants burn 9 CHAP. III. — OF TRADE. (§ 1.) candles made of Russian tallow, while they cannot afford to live upon butchers’ meat. “ It is the great price which England can afford to give, and actually gives, that,” as remarked by a late intelligent writer, “ raises all over Europe the price of every sort of article which comes to her market. The dearth of corn in England has enriched Poland, and many other countries, in a few years, and its wealth is gradually diffusing its influence over other parts of the world.” It is painful to observe, after this very judicious preamble, the same author relapse soon afterwards into the exploded errors of the mercantile system. These facts, which turn almost entirely on the different values of money in different countries, are evidently by no means in¬ consistent with Mr. Smith’s general principle, that in the same society or neighbourhood, the market price of commodities has always a tendency to adjust itself to the natural price. “ The quantity of every commodity brought to market,” says Mr. Smith, naturally suits itself to the effectual demand. It is the interest of all those who employ their land, labour, or stock, in bringing any commodity to market, that the quantity never should exceed the effectual demand ; and it is the interest of all other people that it never should fall short of that demand.”* Notwithstanding, however, this natural tendency in the supply to adjust itself to the demand, a variety of circumstances may prevent it from actually taking place even in the same society or neighbourhood. “ But, in some employments, the same quantity of industry will, in different years, produce very different quantities of commodities, while in others it will pro¬ duce always the same, or very nearly the same. The same number of labourers in husbandry will, in different years, pro¬ duce very different quantities of corn, wine, oil, hops, &c. But the same number of spinners and weavers will every year pro¬ duce the same, or very nearly the same, quantity of linen and woollen cloth. It is only the average produce of the one species of industry which can be suited in any respect to the effectual demand ; and as its actual produce is frequently much greater, and frequently much less than its average produce, the quantity * [Wealth of Nations, Book T. chap. vii. ; Vol. I. p. 86, tenth edition.] 10 POLITICAL ECONOMY. — PART I.— BOOK II.— NAT. WEALTH. of the commodities brought to market will sometimes exceed a good deal, and sometimes fall short a good deal, of the effectual demand. Even though that demand therefore should continue always the same, their market price will be liable to great fluctuations,— will sometimes fall a good deal below, and some¬ times rise a good deal above, their natural price. In tne other species of industry, the produce of equal quantities of labour being always the same, or very nearly the same, it can be more exactly suited to the effectual demand. While that demand continues the same, therefore, the market price of the commo¬ dities is likely to do so too, and to be either altogether, or as nearly as can be judged of, the same with the natural price.” : * Abstracting from these circumstances, other causes may pro¬ duce the same effects. These Mr. Smith refers to three heads, first , particular accidents, which give one society of men an advantage over others in supplying the markets ; secondly , local peculiarities of soil and climate ; and, thirdly , particular regulations of police. t It is to the last of these circumstances (particular regulations of police, such as monopolies, statutes of apprenticeship, &c.) that I am to confine myself in the following observations : — In entering on this subject, Mr. Smith lays it down as a fundamental maxim, that “ the whole of the advantages and disadvantages of the different employments of labour and stock must, in the same neighbourhood, be either perfectly equal, or continually tending to an equality. If, in the same neighbour¬ hood, there was any employment evidently either more or less advantageous than the rest, so many people would crowd into it in the one case, and so many would desert it in the other, that its advantages would soon return to the level of other employments. This, at least, would be the case in a society where things were left to follow their natural course, where there was perfect liberty, and where every man was perfectly free to choose what occupation he thought proper. Every man's interest would prompt him to the advantageous, and to shun the dis¬ advantageous employment. * [Ibid. pp. 87, 88.J f [ Ibid. p. 90.] CHAP. III. — OF TRADE. (§ 1.) 11 “ Pecuniary wages and profit, indeed, are everywhere in Europe extremely different, according to the different employ¬ ments of labour and stock. But this difference arises partly from certain circumstances in the employments themselves, which, either really, or at least in the imaginations of men, make up for a small pecuniary gain in some, and counter¬ balance a great one in others, and partly from the policy of Europe, which nowhere leaves things at perfect liberty.”* It is with the latter of these circumstances alone that we are properly concerned at present. But the enumeration of the circumstances referred to under the former head, maybe useful, as affording an illustration of the general principles which regulate this article of Political Economy. The subject, too, is important in itself ; and I shall compress the leading ideas of Mr. Smith into a very few sentences. According to him, the wages of labour vary by relation to — “ 1. The ease or hardship, cleanness or dirtiness, honourable¬ ness or dishonourableness of the employment. “ 2. The easiness and cheapness, or the difficulty and expense of learning the business ; hence the pecuniary recompense of painters and sculptors, lawyers and physicians, ought to be, and generally is, much more liberal than that of the mechanical employments. “ 3. The constancy or inconstancy of employment ; hence masons and bricklayers are paid higher in proportion than manufacturers, who are sure of constant employment. “ 4. The great or small trust reposed in the workmen ; and — “5. The greater or less probability of success in the em¬ ployment.”')* “ Of the five circumstances, therefore, which vary the wages of labour, two only affect the profits of stock, — the agreeableness or disagreeableness of the business, and the risk or security with which it is attended.” J * [Wealth of Nations, Book I. chap. these, see Wealth of Nations , Book 1. x. ; Yol. I. p. 151, seq., tenth edition.] chap. x. ; Vol. I. pp. 152-170, tenth edition.] f [For Mr. Smith’s illustrations of \ [Ibid.] 12 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. But what I should wish chiefly to remark at present is, that these circumstances, though they occasion considerable inequali¬ ties in the wages of labour and the profits of stock, occasion none in the whole of the advantages and disadvantages, real or imaginary, of the different employments of either. This distribution, however, of labour and stock, which, in so far as it results from the unrestrained choice of individuals, may be regarded as the appointment of nature, has been dis¬ turbed in various ways by the policy of modern Europe. Of these, three are mentioned by Mr. Smith as more particularly deserving of attention. “ First , by restraining the competition in some employments to a smaller number than would otherwise be disposed to enter into them ; secondly , by increasing it in others beyond what it naturally would be ; and thirdly , by obstructing the free cir¬ culation of labour and stock, both from employment to em¬ ployment, and from place to place. “ First , The policy of Europe occasions a very important inequality in the whole of the advantages and disadvantages of the different employments of labour and stock, by restraining the competition in some employments to a smaller number than might otherwise be disposed to enter into them. “ The exclusive privileges of corporations are the principal means it makes use of for this purpose/'* Mr. Smith’s reason¬ ings against apprenticeships will be found in Book I. chap. x. part ii.f Were competition increased by their removal, he ob¬ serves; “ the trades, the crafts, the mysteries, would all be losers. But the public would be a gainer, the work of all artificers coming in this way much cheaper to market.” A remarkable illustration of this last observation is furnished by the history of two villages, which I had once an opportunity of observing with some attention, the villages of La Chaux de Fond and Locle, situated in a small district, which forms part of the principality of Neufchatel. The number of inhabitants in these two villages, and in the adjoining district, was computed, some years ago, at six thousand. They carried on, at that * [Ibid. pp. 183, 184.] f [Ibid. pp. 183-201.] • . CHAP. III. — OF TRADE. (§ 1.) 13 time, an extensive commerce in lace, stockings, cutlery, and various other branches of manufacture ; but watchmaking, and every branch of clockwork, were the articles in which they par¬ ticularly excelled. They not only made every utensil employed in the manufacture, hut had invented several peculiar to them¬ selves ; and all sorts of trade, subservient to those principally carried on, had gradually risen up among them. The number of watches annually made was reckoned at 40,000. Not many years ago, the greatest part of the territory contiguous to these villages, which is now covered with flourishing hamlets and fertile pastures, was almost one continued forest. So rapidly, however, has the population increased, that the produce of the country, which was formerly more than sufficient for the whole of the inhabitants, now scarcely furnishes, according to Mr. Goxe, an eighth part of the provisions necessary for the interior consumption, the remainder being drawn from the adjoining province of Tranche Comte in France. The truth is, that every stranger who brought a certificate of good behaviour was at liberty to settle in the district, and follow any trade he chose, without restriction. “ The origin of watchmaking/' says Mr. Coxe, “in this part of Switzerland, as related by Mr. Osterwald, ancient banneret of Neufchatel, (the historiographer of these mountains,) is ex¬ tremely curious ; and the truth of his account was confirmed to me by several artists both of Locle and La Chaux de Fond. In 1679, one of the inhabitants brought with him from London a watch, the first that had been seen in these parts ; which happening to be out of order, he ventured to trust it in the hands of one Daniel John Richard of La Sagne. Richard, after examining the mechanism with great attention, conceived himself capable, and was determined to attempt, to make a watch from the model before him ; but to this end he was des¬ titute of every other assistance than the powers of his own native genius. Accordingly, he employed a whole year in in¬ venting and in finishing the several instruments previously necessary for executing his purpose ; and in six months from that period, by the sole force of his own penetrating and per- 14 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. severing talents, he produced a complete watch. But his ambition and industry did not stop here ; besides applying himself successfully to the invention of several new instruments »/ useful for the perfection of his work, he took a journey to Geneva, where he gained considerable information in the art. He continued for some time the only man in these parts who could make a watch ; but business increasing, he took in and instructed several associates, by whose assistance he was enabled to supply from his single shop all the demands of the neighbouring country. Towards the beginning of the present century, he removed to Locle, where he died in 1741, leaving five sons, who all of them followed their father’s occupation. From these the knowledge and practice of the art gradually spread itself, till it at length became almost the universal busi¬ ness of the inhabitants, and the principal cause of the populous¬ ness of these mountains.”* Nor has the inventive genius of the people stopped here. A variety of mathematical instruments are to be found in their houses ; and several natives have acquired very considerable fortunes by exhibiting mathematical figures and other objects of mechanical curiosity, in the different countries of Europe. The point of view, however, in which restraints on the freedom of competition appear most injurious to the public prosperity is, when we attend to the undue advantage which they give to the industry of the towns over that of the country. It is from the country that every town draws its whole subsistence, and all the materials of its industry. “ It pays for these chiefly in two ways : first, by sending back to the country a part of those materials wrought up and manufactured ; in which case their price is augmented by the wages of the workmen, and the profits of their masters or immediate employers. Secondly, by sending to it a part both of the rude and manufactured produce, either of other countries, or of distant parts of the same country, imported into the town ; in which case too the original price * [ Sketches of the Natural, Civil, Melmoth, Esq., 1779. Letter XX VII. and Political State of Swisserland ; pp. 338, 339.] in a Series of Letters to William CHAP. III. — OF TRADE. (§ 1.) 15 of those goods is augmented by the wages of the carriers or sailors, and by the profits of the merchants who employ them. In what is gained upon the first of those two branches of com¬ merce, consists the advantage which the town makes by its manufactures ; in what is gained upon the second, the advan¬ tage of its inland and foreign trade. The wages of the work¬ men, and the profits of their different employers, make up the whole of what is gained upon both. Whatever regulations, therefore, tend to increase those wages and profits beyond what they otherwise would be, tend to enable the town to purchase, with a smaller quantity of its labour, the produce of a greater quantity of the labour of the country. They give the traders and artificers in the town an advantage over the landlords, farmers, and labourers in the country, and break down that natural equality which would otherwise take place in the com¬ merce which is carried on between them. The whole annual pro¬ duce of the labour of the society is annually divided between those two different sets of people. By means of those regulations a greater share of it is given to the inhabitants of the town than would otherwise fall to them, and a less to those of the country. “ The price which the town really pays for the provisions and materials annually imported into it, is the quantity of manufactures and other goods annually exported from it. The dearer the latter are sold, the cheaper the former are bought. The industry of the town becomes more, and that of the country less advantageous. . . . “ The superiority which the industry of the towns has every¬ where, in Europe, over that of the country, is not altogether owing to corporations and corporation laws. It is supported by many other regulations. The high duties upon foreign manu¬ factures, and upon all goods imported by alien merchants, all tend to the same purpose. Corporation laws enable the inhabi¬ tants of towns to raise their prices, without fearing to be under¬ sold by the competition of their own countrymen. Those other regulations secure them equally against that of foreigners. The enhancement of price occasioned by both is everywhere finally paid by the landlord, farmers, and labourers of the country 16 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. who have seldom opposed the establishment of such monopolies. They have commonly neither inclination nor fitness to enter into combinations ; and the clamour and sophistry of merchants and manufacturers, easily persuade them that the private inter¬ est of a part, and of a subordinate part, of the society, is the general interest of the whole. “ In Great Britain, the superiority of the industry of the towns over that of the country, seems to have been greater formerly than in the present times. The wages of country labour approach nearer to those of manufacturing labour, and the profits of stock employed in agriculture to those of trading and manufacturing stock, than they are said to have done in the last century, or in the beginning of the present. This change may be regarded as the necessary, though very late, con¬ sequence of the extraordinary encouragement given to the industry of the towns. The stock accumulated in them comes in time to be so great, that it can no longer be employed with the ancient profit in that species of industry which is peculiar to them. That industry has its limits like every other ; and the increase of stock, by increasing the competition, necessarily reduces the profit. The lowering of profit in the town, forces out stock to the country, where, by creating a new demand for country labour, it necessarily raises its wages. It then spreads itself, if I may say so, over the face of the land, and by being employed in agriculture, is in part restored to the country, at the expense of which, in a great measure, it had originally been accumulated in the town.”* For the explanation of the causes which, in modern Europe, have thus given to the commerce of the towns so decided an advantage over that of the country, I refer to what Mr. Smith has said on the subject in the third and fourth chapters of his Third Book, concerning the rise and progress of cities and towns after the fall of the Roman Empire. On the same subject, too, a great deal of most important and curious information is to be found in the first volume of Dr. Robertson's History of Charles the Fifth. * [Health of Nations, Book I. chap. x. ; Vol. I. pp. 193-199, tenth edition.] CHAP. III. - OF TRADE. (§ 1.) 17 To this general head of the privileges of corporations, the question concerning the advantages to be derived from univer¬ sities properly belongs. Some valuable hints on this question have been suggested by Mr. Smith ; but I must not at present enter upon the discussion. Another class of obstructions to the natural distribution of labour and stock in the community, is produced by exclusive companies and monopolies of every description. The enormous length to which monopolies were carried in the reign of Queen Elizabeth, is well known. Mr. Hume tells us, that u she granted her servants and courtiers patents for monopolies ; and these patents they sold to others, who were thereby enabled to raise commodities to what price they pleased, and who put invincible restraints upon all commerce, industry, and emulation in the arts. It is astonishing to consider the number and importance of those commodities, which were thus assigned over to patentees. Currants, salt, iron, powder, cards, calf-skins, fells, pouldavies, ox shin-bones, train oil, lists of cloth, pot-ashes, anise-seeds, vinegar, sea-coals, steel, aquavitm, brushes, pots, bottles, salt¬ petre, lead, accidence, oil, calaminestone, oil of blubber, glasses, paper, starch, tin, sulphur, new drapery, dried pilchards, trans¬ portation of iron ordnance, of beer, of horn, of leather, importa¬ tion of Spanish wool, of Irish yarn. These are but a part of the commodities which had been appropriated to monopolists.”* These monopolies were, in a great measure, removed by a statute of James First, declaring all monopolies to be “ contrary to law, and to the known liberties of the people. It was then supposed, that every subject of England had entire power to dispose of his own actions, provided he did no injury to his fellow-subjects, and that no prerogative of the king, no power of any magistrate, nothing but the authority alone of laws could restrain that unlimited freedom. ”f While James, however, called in and annulled all the patents for monopolies which had been granted by his predecessors, and which had extremely fettered every species of domestic industry, exclusive companies still remained, — another species of mono- * [History of England, Chap, xliv.] t [Ibid. chap, xlix.j VOL. IX. B 18 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. poly, by which every prospect of future improvement in com¬ merce was for ever sacrificed for a little temporary advantage to the sovereign. Of this species of monopoly there are still various examples, which have the most extensive influence on the general prosperity of this country. Their necessary effect, in every instance, is not only to exclude the greater part of the nation from a trade to which it might be convenient for them to turn their stock, but to oblige them to buy the goods, which are the subject of it, at a dearer rate than if the' trade were open to all. For a full illustration of these observations, I must refer to the seventh chapter of the Fourth Book of the Wealth of Nations. The doctrine of the freedom of trade, in so far as it applies to monopolies and exclusive companies, seems to have been per¬ fectly understood by various writers of the seventeenth century, and particularly by Sir J osiah Child ; and after him, Mr. Cary, a merchant of Bristol, who published, in the year 1695, a short and very ingenious essay on the state of England in relation to its trade. The same doctrine is strongly and repeatedly urged by the celebrated John de Witt, in a work entitled, The True Inter¬ ests and Maxims of the Bepublic of Holland and West-Fries- land : — “ Next to a liberty of serving God, follows the liberty of gaining a livelihood without any dear-bought city freedom, but only by virtue of a fixed habitation, to have the common right of other inhabitants ; which is here very necessary for keeping the people we have, and inviting strangers to come amongst us. For it is evident, that landed men, or others that are wealthy, being forced by any accident to leave their country or habita¬ tion, will never choose Holland to dwell in, being so chargeable a place, and where they have so little interest for their money. And for those who are less wealthy, it is well known, that no man from abroad will come to dwell or continue in a country where he shall not be permitted to get an honest maintenance. And it may be easily considered, how great an inconveniency it would be in this country for the inhabitants, especially strangers, if they should have no freedom of choosing and practising such honest means of livelihood as they think best for their sub- CHAP, III. — OF TRADE. (§ 1.) 19 sistence ; or if, when they had chosen a trade, and could not live by it, they might not choose another. This, then, being evident, that strangers without freedom of earning their bread, and seeking a livelihood, cannot live amongst us ; and as it is certain, that our Manufactories, Fisheries, Traffic, and Naviga¬ tion, with those that depend upon them, cannot, without con¬ tinual supplies of foreign inhabitants, be preserved here, and much less, augmented or improved ; it is likewise certain, that among the endless advantages which accrue to Holland by strangers, and which might accrue more, our boors may be be likewise profited. For we see, that for want of strangers in the country, the boors must give such great yearly and day- wages to their servants, that they can scarcely live, but with great toil, themselves, and their servants live rather in too great plenty. The same inconveniences we are likewise sensible of in cities, amongst tradesmen and servants, who are here more chargeable and burdensome, and yet less serviceable than in any other countries. . . . Therefore, it is necessary that all strangers that are masters, journeymen, consumptioners, mer¬ chants, traders, &c., should live peaceably amongst us, without any disturbance, let, or molestation whatever, and use their own estates and trades as they shall judge best.”* Nothing, however, in any of these writers, is more explicit or more enlightened than the language of the common law of England on this subject. As early as the reign of Henry the Sixth, Lord Chief- Justice Fortescue, who was a zealous friend, too, of prerogative, declares, in his book Be Laudibus Legum Anglice , cap. xxxvi., that “ it is lawful for any man to trade and store himself with any wares and merchandise at his own pleasure, and that every inhabitant of England by law enjoyeth all the fruits of his land, with all the profits he gaineth by his own labour.” Such, also, is very nearly the language of a statute of James the First, formerly referred to, by which it is expressly enacted, “ that all commissions, grants, licenses, char¬ ters and letters patent heretofore made or granted, or hereafter to be made or granted, to any person or persons, bodies politic * [Part I. chap. xv. p. 66, seq. Ed. Lend. 1702.] 20 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. or corporate whatsoever, of, or for the sole buying, selling, making, working, or using of anything within this realm , . . . and all proclamations, inhibitions, restraints, warrants of assistants, and all other matters and things whatsoever, any way tending to the instituting, erecting, strengthening, furthering, or countenancing of the same, or any of them, are altogether contrary to the laws of this realm, and so are, and shall be utterly void and of none effect, and in no wise to be put in use or execution.” The following passage I quote verbatim from a petition presented to the House of Commons in 1691, relative to the East India trade, on behalf of divers Merchants and Traders in and about the City of London , and other their Majesties Subjects. “ The trade to the East Indies is of very great importance to this nation ; and yet, by the manifold abuses of the present East India Company both at home and abroad, (who have managed the same for their private gain, without any regard to the public good,) the trade is likely to be utterly lost to this kingdom, and to fall into the hands of foreigners, unless timely prevented by some better regulation thereof, on a new joint-stock and constitution.” The petitioners further pray, u that the House will take into consideration the establishing of a new East India Company, in such manner, and with such powers and limitations, as to them shall be thought most conducing to the preservation of so beneficial a trade to the kingdom.” One great objection urged by the favourers of the Company against the freedom of trade is, that “ it will not only cause the said trade to suffer much, but other European nations will make great advantage thereof, to the hazard, if not the ruin, of the English commerce to those parts.” In this manner, then, the policy of Europe, by the privileges of corporations, by apprenticeships, exclusive companies, and other regulations favouring monopolies, restrains the competi¬ tion in some employments of stock and labour to a smaller number than would otherwise be disposed to enter into them. “ Secondly , In some other cases, it tends to increase the com¬ petition beyond the natural proportion.”* Of these, obvious * [Wealth of Nations ,Book I. chap. x. ; Vol.-I. p. 202, tenth edit. — See above, p. 12.] CHAP. III. — OF TRADE. (§ 1.) 21 examples are found in the institutions of bursaries, scholarships, &c. On this article, however, it is unnecessary to enlarge, as the inconveniences which they produce to individuals are amply compensated by the public benefit which attends them. “ Thirdly , The policy of Europe, by obstructing the free cir¬ culation of labour arid stock both from employment to employ¬ ment, and from place to place, occasions in some cases a very inconvenient inequality in the whole of the advantages and disadvantages of their different employments. “ The statute of apprenticeship obstructs the free circulation of labour from one employment to another, even in the same place. The exclusive privileges of corporations obstruct it from one place to another, even in the same employment. u It frequently happens, that while high wages are given to the workmen in one manufacture, those in another are obliged to content themselves with bare subsistence. The one is in an advancing state, and has, therefore, a continued demand for new hands ; the other is in a declining state, and the superabundance of hands is continually increasing. Those two manufactures may sometimes be in the same town, and sometimes in the same neigh¬ bourhood, without being able to lend the least assistance to one another. The statute of apprenticeship may oppose it in the one case, and both that and an exclusive corporation in the other. In many different manufactures, however, the operations are so much alike, that the workmen could easily change trades with one another, if those absurd laws did not hinder them. . . . “ The obstruction which corporation laws give to the free cir¬ culation of labour, is common, I believe, to every part of Europe. That which is given to it by the poor-laws is, so far as I know, peculiar to England. It consists in the difficulty which a poor man has in obtaining a settlement, or even in being allowed to exercise his industry in any parish but that to which he belongs. It is the labour of artificers and manufactures only of which the free circulation is obstructed by corporation laws. The diffi¬ culty of obtaining settlements obstructs even that of common labour.”* But I shall delay entering on the consideration of the * [Ibid. pp. 209-212.] 22 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. English poor-laws, till we have taken a view of the different sys¬ tems which have been proposed for the maintenance of the poor. So much with respect to the policy of restraints on domestic commerce and industry. [subsect. ii. — Of Restraints on the Commercial Intercourse of Different Nations i\ I shall now proceed to consider the restraints which affect the commercial intercourse of different nations. The system of regula¬ tions, which we are to examine under that head, is distinguished by Mr. Smith by the title of the Commercial or Mercantile system of Political Economy. This last phrase, as before hinted, is used by him in a very restricted sense. Its objects, he tells us, are the two following : — “ 1st, To provide a plentiful revenue or subsistence for the people, or more properly, to enable them to provide such a revenue or subsistence for themselves ; and, 2 dly, To supply the state or commonwealth with a revenue suf¬ ficient for the public services.”* According to the definition which I formerly gave of Political Economy ,f it applies to all the different objects of lav/ and political regulation, among which, undoubtedly, the principles which regulate the systems of agri¬ cultural or commercial policy occupy a very distinguished place. I mention this circumstance, that I may not be supposed, by adopting the language of Mr. Smith, to have lost sight of the explanation given in my Introductory Lectures of the province of Political Economy. In stating the argument for a free trade with other countries, I shall aim at nothing more than a very succinct abridgment of Mr. Smith’s doctrines on this subject ; a general knowledge of which I must necessarily presuppose in my hearers, when I proceed to the discussion of some of the questions connected with these inquiries. While this outline may facilitate the studies of those who have not yet perused that invaluable work, it will, I hope, be not altogether useless to others, as containing a recapitu¬ lation of some of the more important doctrines which it explains. * [Ibid. Book IV. Introduction ; Vol. f \Supra, Political Economy, Vol. I. II. p. 138, tenth edition.] p. 9, seq •] CHAP. III. — OF TRADE. (§ 1.) 23 The great principle of the Mercantile system is, that money constitutes the wealth of a nation, or in other words, that a nation is rich or poor in proportion to the plenty or scarcity of the precious metals. (Here Mr. Stewart introduced an abridged view of the first eight chapters of the fourth book of the Wealth of Nations* * [The abstract here alluded to by Mr. Bridges, as given in the notes taken by Mr. Bonar, is as follows : — “ It was for a long time the opinion of statesmen, that as the wealth of an individual consists in the quantity of money which he possesses, or can command, and that as the more this is increased, the more is his wealth augmented, so the same thing must hold true of a nation ; and, therefore, that the more gold and silver which can be accumulated in a nation, the more will its opulence and prosperity be increased. Hence one great object of government was, by means of laws and regulations, to prevent the exportation of gold and silver out of a country, and to draw into the country as much specie as possible. Experience, however, at last proved that all such attempts were unavailing ; that where a superfluity of gold and silver was accumulated in a country, no laws or regulations could prevent its being sent abroad for the purchase of commo¬ dities. This is clearly proved in the case of Spain and Portugal, where all their sanguinary laws against carrying gold and silver out of the country have never prevented their exportation, as they come into these countries in greater abundance than their own necessities require. It has been computed that the Lisbon packet brings over to Britain on an average no less than £50,000 worth of gold and silver weekly. This may not be accurate, but there can be no doubt that all the laws and regulations that were made, never had the effect of detaining in the country the superfluous gold and silver that could not be made use of if it remained. “ Governments finding it impossible to restrain by force the exportation of gold and silver from a country, came next to turn their attention to what was termed the balance of trade. It was thought, that according to the value which these commodities imported by a nation bear to the commodities exported by it, as greater or less, so would the prosperity of the country rise or fall. If it was found that the value of the goods sent out was greater than that of those imported, then it was of course reckoned that the country was in a prosperous state, — but if it was otherwise, the country was deemed to be declining. “ For the ascertaining of the value of the commodities sent out and received, two methods were had recourse to, one was the Custom House books, the other the Eate of Exchange.” (After referring to Mr. Macpherson’s views given in the text on the Custom House entries as testing a nation’s pro¬ sperity, Mr. Bonar proceeds :) — “ The other criterion resorted to for this pur¬ pose, — the Eate of Exchange, though perhaps not quite so fallacious, yet is by no means a certain test. Many cir¬ cumstances often occasion a rise or fall in the course of the Exchange, inde¬ pendent of the amount of goods actually exported and imported. “ Notwithstanding the fallacy of the modes of ascertaining the proportional value of commodities exported and im¬ ported, still the balance of trade, as it has been called, has been constantly the object of solicitous attention to govern¬ ments. With a view to guard against what is supposed an unfavourable bal- 24 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. with the following additions. After stating Mr. Smith’s reason¬ ings with regard to the Navigation Act, he added :) — On the same principle have been founded some late reasonings, ance, it has been the aim of legislators, by laws and regulations, to restrain commerce with foreign nations, in such a manner as they thought most likely to prevent the consequence so much dread¬ ed. This has been attempted chiefly in two ways : — the imposition of heavy duties, or even the total prohibition of importing the commodities of another nation, — and the granting of bounties and other encouragements to the expor¬ tation of native commodities. ‘ These restraints upon importation, and encour¬ agements to exportation, constitute,’ as Mr. Smith remarks, ‘ the principal means by which the Commercial System proposes to increase the quantity of gold and silver in any country, by turning the balances of trade in its favour.’* “ Against this system Mr. Smith argues in the following satisfactory and conclusive manner: — “ ‘ By restraining either by high duties or by absolute prohibitions, the importa¬ tion of such goods from foreign countries as can be produced at home, the mono¬ poly of the home market is more or less secured to the domestic industry employ¬ ed in producing them. . . , That this monopoly of the home market frequently gives great encouragement to that par¬ ticular species of industry which enjoys it, and frequently turns toward that em¬ ployment a greater share of both the labour and stock of the society, than would otherwise have gone to it, cannot lie doubted. But whether it tends either to increase the general industry of the society, or to give it the most advan¬ tageous direction, is not perhaps alto¬ gether so evident. . . . No regulation of commerce can increase the quantity of industry in any society, beyond what * [Wealth of Nations, Book IV. chap t [Ibid. chap. ii. p. 176, seq. ] its capital can maintain. It can only divert a part of it into a direction into which it might not otherwise have gone ; and it is by no means certain that this artificial direction is likely to be more advantageous to the society than that into which it would have gone of its own accord. Every individual is continually exerting himself to find out the most advantageous employment for whatever capital he can command.’ f “ ‘ As every individual endeavours as much as he can, both to employ his capital in the support of domestic in¬ dustry, and so to direct that industry that its produce may be of the greatest value, every individual therefore labours to render the annual revenue of the society as great as he can. He generally indeed neither intends to promote the public interest, nor knows how much he is promoting it. . . . He intends only his own gain ; and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention. Nor is it the worse for the society that it was no part of it. By pursuing his own interest, he fre¬ quently promotes that of the society more effectually than when he really intends to promote it. . . . “ ‘What is the species of domestic industry which his capital can employ, and of which the produce is likely to be of the greatest value, every individual, it is evident, can, in his local situation, judge much better than any statesman or lawgiver can do for him. The states¬ man who should attempt to direct pri¬ vate people in what manner they ought to employ their capitals, would not only load himself with a most unnecessary attention, but assume an authority which i. ; Vol. II. p. ]75, tenth edition. J CHAP. HI. — OF TRADE. (§ 1.) 25 which are not altogether destitute of plausibility, but which, on examination, will be found extremely unsound, in favour of the active interposition of Government to produce an increased could safely be trusted, not only to no single person, but to no council or senate whatever, and which would nowhere be so dangerous as in the hands of a man who had folly and presumption enough to fancy himself fit to exer¬ cise it. “ ‘ To give the monopoly of the home market to the produce of domestic in¬ dustry, in any particular art or manu¬ facture, is in some measure to direct private people in what manner they ought to employ their capitals, and must, in almost all cases, be either a use¬ less or a hurtful regulation. If the pro¬ duce of domestic can be brought there as cheap as that of foreign industry, the regulation is evidently useless. If it cannot, it must generally be hurtful. It is the maxim of every prudent master of a family, never to attempt to make at home what it will cost him more to make than to buy. The tailor does not attempt to make his own shoes, but buys them of the shoemaker. The shoe¬ maker does not attempt to make his own clothes, but employs a tailor. The farmer attempts to make neither the one nor the other, but employs those differ¬ ent artificers. All of them find it for their interest to employ their whole in¬ dustry in a way in which they have some advantage over their neighbours, and to purchase with a part of its pro¬ duce, or what is the same thing, with the price of a part of it, whatever else they have occasion for. “ ‘ What is prudence in the conduct of every private family, can scarce be Tolly in that of a great kingdom. If a foreign country can supply us with a commodity cheaper than we ourselves can make it, better buy it of them with some part of the produce of our own in¬ dustry employed in a way in which we have some advantage. The general in¬ dustry of the country being always in proportion to the capital which employs it, will not thereby be diminished, no more than that of the above mentioned artificers’, but only left to find out the way in which it can be employed with the greatest advantage. It is certainly not employed to the greatest advantage when it is thus directed towards an object which it can buy cheaper than it can make. The value of its annual produce is certainly more or less dimin¬ ished when it is thus turned away from producing commodities evidently of more value than the commodity which it is directed to produce : according to the supposition, that commodity could be purchased from foreign countries cheaper than it can be made at home. It could therefore have been purchased with a part only of the commodities, or what is the same thing, with a part only of the price of the commodities, which the indus¬ try employed by an equal capital would naturally have produced at home. . . . “ ‘ By means of such regulations, indeed, a particular manufacture may sometimes be acquired sooner than it could have been otherwise, and after a certain time may be made at home as cheap or cheaper than in the foreign country. But it will by no means follow that the sum total either of its industry or of its revenue can ever be augmented by any such regulation. . . . Though for want of such regulations the society should never acquire the pro¬ posed manufacture, it would not upon that account necessarily be the poorer in any one period of its duration. Its whole capital and industry might still have been employed, though upon dif¬ ferent objects, in the manner the mos advantageous at the time. . . . 26 POLITICAL ECONOMY. — PART I. — BOOK II.— NAT. WEALTH. plantation of English oaks, in order to render the regular sup¬ ply of timber for his Majesty’s dock-yards independent of the accidents of commerce and war. On these reasonings, I pro- “ ‘ The natural advantages which one country has over another in producing particular commodities, are sometimes so great, that it is acknowledged by all the world to be in vain to struggle with them. By means of glasses, hot-beds, and hot walls, very good grapes can be raised in Scotland ; and very good wine too can be made of them at about thirty times the expense for which at least equally good can be brought from foreign countries. Would it be a reasonable law to prohibit the importation of all foreign wines, merely to encourage the making of Claret and Burgundy in Scot¬ land ? But if there would be a manifest absurdity in turning towards any em¬ ployment, thirty times more of the capital and industry of the country, than would be necessary to purchase from foreign countries an equal quantity of the commodities wanted, there must be an absurdity, though not altogether so glaring, yet exactly of the same kind, in turning towards any such employ¬ ment a thirtieth, or even a three hun¬ dredth part more of either.’ * “ The reasoning through all this pas¬ sage appears to me clear and satisfac¬ tory ; and from the whole it is plain, and may be assumed as certain truth, that the system of forcing, by restraints upon foreign commodities, a part of the capital of a nation from its natural direction, instead of being beneficial, must be highly prejudicial. “One exception only is made by Mr. Smith, that is, ‘ when some particular sort of industry is necessary for the defence of the country. The defence of Great Britain, for example, depends very much upon the number of its sailors and ship¬ ping. The Act of Navigation, there¬ fore, very properly endeavours to give the sailors and shipping of Great Britain the monopoly of the trade of their own country, in some cases, by absolute pro¬ hibitions, and in others by heavy bur¬ dens upon the shipping of foreign coun¬ tries.’ ”f (After Mr. Stewart’s remarks on this exception, Mr. Bonar continues:) — “Besides the restraining, or totally pro¬ hibiting the importation of certain spe¬ cies of commodities for the encourage¬ ment of domestic production, the Com¬ mercial System has devised another expedient for the purpose of preventing what has been supposed the unfavour¬ able balance of trade ; that is, the grant¬ ing extraordinary encoui'agements to the exportation of commodities by the means of draivbacks and bounties. “‘Of these,’ Mr. Smith justly re¬ marks, ‘ drawbacks seem to be the most reasonable. To allow the merchant to draw back upon exportation either the whole, or a part of whatever excise or inland duty is imposed upon domestic industry, can never occasion the expor¬ tation of a greater quantity of goods than what would have beeu exported had no duty been imposed. Such en¬ couragements do not tend to turn towards any particular employment a greater share of the capital of the country, than what would go to that employment of its own accord, but only to hinder the duty from driving away any part of that share to other employments. . . . “ ‘ The same thing may be said of the drawbacks upon the re-exportation of foreign goods imported.’ j: “ The case, however, is different in * [Ibid. pp. 181-185.] t [Ibid. p. 192.] j [Ibid. p. 252, .very.] CHAr. III. — OF TRADE. (§ 1.) 27 pose to offer some particular strictures afterwards. But I shall first finish the general outline of Mr. Smith's view of the Mer¬ cantile system, before proceeding to this. (After stating the disposition which this country has always manifested to depress the commerce of France, Mr. Stewart observed :) — The impolicy of these regulations was distinctly declared in the late commercial treaty entered into with that country. The influence, I may observe, which the writings of Mr. Smith are allowed to have had on our national conduct, in this and some other instances, affords a memorable example of the triumph of philosophy over the dictates of prejudice, and leads us to indulge a hope, that in an age of free and unrestrained dis¬ cussion like the present, principles founded on truth and justice will gradually supplant the errors of ignorance. (After stating the nature of the evidence which the custom- respect to bounties. These are expressly given ‘ to enable merchants and manu¬ facturers to sell their goods as cheap or cheaper than their rivals in the foreign market. . . . We cannot, it is said, force foreigners to buy our goods ; the next best expedient, therefore, it has been thought, is to pay them for buying. It is in this manner that the mercantile system proposes to enrich the whole country. Bounties, it is allowed, ought to be given to those branches of trade only which cannot be carried on without them. But every branch of trade in which the merchant can sell his goods for a price which replaces to him, with the ordinary profits of stock, the whole capital employed in preparing and send¬ ing them to market, can be carried on without a bounty. . . . Those trades only require bounties in which the mer¬ chant is obliged to sell his goods for a price which does not replace to him his capital together with the ordinary profit, < >r in which he is obliged to sell them for less than it really costs him to send them to market. The bounty is given in order to make up this loss, and to encourage him to continue, perhaps to begin a trade of which the expense is supposed to be greater than the returns, of which every operation eats up a part of the capital employed in it, and which is of such a nature, that if all other trades resembled it, there would soon he no capital left in the country. ... If the bounty did not repay to the merchant what he would otherwise lose upon the price of his goods, his own interest would soon oblige him to employ his stock in another way, or to find out a trade in which the price of the goods would replace with the ordinary profit the capital employed in sending them to market. The effect of bounties, like that of all the other expedients of the mer¬ cantile system, can only be to force the trade of acountry into achannel much less advantageous than that in which it would naturally run of its own accord.’”] * * [Ibid. pp. 261-263.] 28 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. house books afford of the balance of trade, Mr. Stewart observed :) — As Mr. Smith has not entered into any details, with regard to the nature of the objection to the evidence of the custom¬ house books in this respect, taking their fallaciousness for granted as a thing too well understood to require any particular illustration, it may not be improper to supply this elementary article of information, by a short statement of the particular facts and principles on which the doctrine may be justified. This is the more necessary, as the complicated commercial accounts of nations have been usually stated like the simple transactions of private merchants ; and the technical business¬ like appearance of accuracy which the results exhibit, are apt to procure to them a degree of popular credit to which they have in truth no claim, and which is daily employed to mislead the public mind, by writers who, at the time, are fully aware of their general incorrectness. In illustration of this subject, I gladly avail myself of some judicious remarks of Mr. Macpherson. u It has been customary/' says that very laborious and accurate writer, “ to consider our trade with those countries, from which we import a greater value than we export to them, as unprofit¬ able ; and that to those, to which our exports exceed the value of our imports, as profitable. But such a rule is liable to a great number of exceptions. The apparent balance must be frequently erroneous from the inaccuracy of the valuation. For example, the Irish linens are all rated in the custom-house entries in England at eightpence a yard on an average, whereas one shilling and fourpence a yard, the average price assumed in the Irish custom-house books, is rather under the value. As linens generally constitute above a half of the value of the imports from Ireland to England and Scotland, the error in the value of that one article turns the balance of trade with Ireland against Great Britain ; (See Lord Sheffield's Obser¬ vations on the Manufactures , cfc.. of Ireland , p. 276, third edition, 1785 ;) and the valuations in many other branches ol our commerce are not a whit more accurate. Money brought into Great Britain is not subject to entry, and CHAP. III. — OF TRADE. (§ 1.) 29 therefore does not appear in the custom-house books, any more than bills of exchange. Money carried out swells the amount of export entries, and consequently enlarges the sup¬ posed general profit ; though, according to the doctrine that gold and silver are the only standard of wealth, such exportation is so much clear loss to the nation. Great quantities of goods, subject to high duties, totally prohibited, or shipped for expor¬ tation upon bounties or drawbacks, are clandestinely imported. Such importations, though not appearing in the general account, there is reason to believe, have considerable influence on the exchange with some neighbouring countries. And such of those smuggled goods as have been entered for exportation, perhaps over and over again, thus make great additions to the fallacious estimate of the profitable balance, without ever being, in reality, exported at all for foreign consumption. All goods exported for the use of our armies abroad, are part of the national expenditure, and can no more constitute a real part of the profitable balance, apparently swelled by their exportation, than the goods taken from his stock by a manufacturer or shop¬ keeper for his own use, can be stated as enlarging his profitable sales. Cargoes entered outward, which are lost at sea, or taken by the enemy, swell the amount of exports, and, consequently, of supposed profit, whereas, in fact, they are a dead loss to the nation, (and, in case of capture, tend to enrich the enemy, by whom they are in reality exported;) while the want of the homeward cargo, which should have been imported in return, and which, to the individual sufferer, is not only a real loss but a heavy disappointment and derangement of his plans of trade, tends to enlarge the supposed balance of trade in our favour. And the loss or capture of homeward-bound ships in the same manner, by diminishing the amount of entered imports, falla¬ ciously adds to the apparent favourable balance. “ On the other hand, there are branches of trade which would be ruinous if the imports did not exceed the exports, or, in other words, if the balance were not unfavourable , according to this standard of estimation. Such is the trade with all our West India settlements, which have been formed and supported by 30 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. British capitals, and, in a great measure, owned by proprietors residing in Great Britain. Therefore, the outward cargoes are to be considered as the stock employed in the culture of the plantations ; and the homeward cargoes are, in fact, the pro¬ ceeds of that culture, the excess of which is not a loss to the nation, but the real amount of the net profits coming into the pockets of the proprietors, and giving a very comfortable demon¬ stration how much the amount of the product is more than the prime cost. In other words, the outward cargoes are the seed , and the inward cargoes are the harvest. . . . The same reason¬ ing will also hold good with the trade to Hudson s Bay, and several others, wherein the excess of the imports is the real profit, and a continuation of favourable balances would, in a few years ruin the trade. In some branches of business, the goods exported are merely the charges of trade, as is the case in all fisheries. ... “ There is another kind of deceptive inference to be drawn from the custom-house entries, if not duly guarded against. It is necessary to advert, that the exports to some countries con¬ stitute the prime cost of cargoes to be shipped off from them to a third country. Thus, the wines of Madeira are sent to the British settlements in the East and West Indies, and, even if intended for Britain, are often carried by the circuitous route of those distant regions before they are brought home. The bulk of the cargoes from Africa consists of the miserable natives, who are sold in the West Indies ; and the proceeds are gene¬ rally remitted to great Britain in hills of exchange, which do not appear at all in the custom-house books. And, in like manner, most of the cargoes, carried from Newfoundland and the adjacent countries, consist of fish, which never come to Great Britain, but are sold in Spain, Portugal, and other Roman Catholic countries, and their proceeds also brought home in bills of exchange. “ Were we to estimate the prosperity of a country merely from the balance of trade iir the custom-house books, Scotland must be pronounced to be in a ruinous state ever since the American war, the imports from foreign countries being frequently more CHAP. III. — OF TRADE. (§ 1.) 31 than the exports to them, as will appear by the accounts to be found in the subsequent part of this work. But the truth is, that since that event the people of Scotland have paid more attention than formerly to manufactures, which (by land car¬ riage and coasting navigation, neither of which appear in the custom-house hooks) are carried to every part of Great Britain, and enter to a much greater amount into the exports of London than into those of Glasgow ; and that, upon the whole, the trade of Scotland is now more flourishing than ever. “ From what has been said it will appear, that all arguments, calculations, or arrangements, founded upon the supposed balance of trade, are very fallacious ; and that those founded upon the balance with any particular country, are generally much more fallacious than those deduced from the general balance of the whole foreign trade of the nation.”* Thus far I have followed the statements of Mr. Macpherson, whose observations appear to me to form a very interesting and instructive comment on that part of Mr. Smith’s reply to the Mercantile system, in which he reasons with its advocates on their own fundamental principle. I nowT proceed to a still more important part of Mr. Smith’s argument, in which he endeavours to show that the whole doctrine of the balance of trade is absurd. It is now a considerable number of years since these liberal principles came to be adopted by all the most enlightened writers of Europe. Mr. Hume was one of the first in this country who stated them in such a form as to attract to them some share of the public favour ; and he had undoubtedly the merit of encouraging, by his example, his friend Mr. Smith to devote his profound and comprehensive genius to a systematical illustration of them. His Political Discourses were first printed in the year 1752, and, according to himself, were the only part of his works which were successful on the first publication. They have undoubtedly very great merit, and although erroneous in some fundamental maxims, may justly be regarded, on the whole, as one of the most valuable performances of the author. * [Annals of Commerce , &c., 1805, Part III. Vol. iii. pp. 341-344.] 32 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH, The Essay on the Jealousy of Trade concludes with the follow¬ ing very striking reflections : — a Were our narrow and malig¬ nant politics to meet with success, we should reduce all our neighbouring nations to the same state of sloth and ignorance that prevails in Morocco and the coast of Barbary. But what would be the consequence ? they could send no commodities ; they could take none from us ; our domestic commerce itself would languish for want of emulation, example, and instruction ; and we ourselves should soon fall into the same abject condition to which we had reduced them. I shall therefore venture to acknowledge, that, not only as a man, but as a British subject, I pray for the flourishing commerce of Germany, Spain, Italy, and even France itself. I am at least certain, that Great Britain and all those nations would flourish more did their sovereigns and ministers adopt such enlarged and benevolent sentiments towards each other.”* At the period when this passage first appeared, it was con¬ sidered as among the most paradoxical and dangerous parts of Mr. Hume’s political writings ; and yet it assumes nothing more than what a moment’s consideration might have taught to any man of a plain and unprejudiced understanding, that a commercial nation has precisely the same interest in the wealth of its neighbours which a tradesman has in the wealth of his customers. It is to the general progress of civilized nations in the arts and improvements of social life, that the prosperity of England is chiefly owing. Nor is it going too far to say, with a late writer, “ that not one acre is brought into cultivation in the wilds of Siberia which has not widened the market for English goods.” On the other hand, it is no less manifest, that the benefits of this extended commerce are reciprocal ; and that while English industry is thus encouraged by the progres¬ sive prosperity of its neighbours, it amply repays whatever it receives. It can only be employed in advancing civilisation and enjoyment over the whole earth ; and it is actually exerted at this present moment, in consequence of the obstacles pre¬ sented by the laws of nature to the impotent tricks of govern- * [ Essays, Vol. I.] CHAP. III. OF TRADE. (§ 1.) 33 ment, to revive the industry of those very nations who liave been the loudest in their outcries against its progress. If they obtained their wishes for the destruction of English prosperity, this would have no other effect than to reduce those nations themselves, who now ascribe their present depression to its influence, to a state of complete ruin. The same liberal principles concerning trade, which were advanced by Mr. Hume, were soon after adopted, and very zealously enforced, by Dean Tucker, in various judicious per¬ formances ; and, particularly, in a small work entitled Four Tracts on Folitical and Commercial Subjects , published in the year 1774. Much about the same time they attracted still more general attention, at least among practical men, in conse¬ quence of the sanction which they received from the pen of Dr. Franklin, a writer unrivalled in his own peculiar and charac- teristical style of composition, but unqualified, it is probable, by the habits of his early education, for that systematical arrangement of principles which we remark in the writings of Mr. Smith ; while, however, he is eminently fitted to seize the valuable results of the speculations of others, and to present them in a strong light to the common sense of mankind. I shall only quote one passage from this writer, which I select merely from its more immediate connexion with the doctrines which I have been just stating. — “ Perhaps, in general, it would be better if government meddled no farther with trade than to protect it, and let it take its course. Most of the statutes, or acts, edicts, arrets , and placarts of parliaments, princes, and states, for regulating, directing, or restraining of trade, have, we think, been either political blunders, or jobs ob¬ tained by artful men for private advantage, under pretence of public good. When Colbert assembled some wise old merchants of France, and desired their advice and opinion how he could best serve and promote commerce, their answer after consulta¬ tion was, in three words only, Laissez nous faire , ‘ Let us alone/ It is said by a very solid writer of the same nation, that he is well advanced in the science of politics who knows the full force of that maxim, Pas trap gouverner , c Not to VOL. ix. c 34 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. govern too much — which, perhaps, would he of more use when applied to trade, than in any other public concern. It were therefore to be wished that commerce was as free between all the nations of the world, as it is between the several counties of England • so would all, by mutual communication, obtain more enjoyments. These counties do not ruin one another by trade, neither would the nations. No nation was ever mined by trade, even seemingly the most disadvantageous.”* It would require more time than we can now afford to be¬ stow, to trace historically the origin and progress of those liberal and enlightened ideas which abound in Mr. Smith's writings. I shall content myself, therefore, with remarking, that although it was by some French writers that they were first presented to the world in a systematical manner, yet the earliest hints of them seem to have been suggested in this country. I shall, perhaps, have an opportunity of producing some additional proofs of this statement afterwards. In the meantime, I shall only quote some remarks from a pamphlet on Money, published in the year 1734, [by Jacob Vanderlint :] — “ All nations have some commodities peculiar to them, which, therefore, are undoubtedly designed to be the foundation of commerce between the several nations, and produce a great deal of maritime employment for mankind, which probably, without such peculiarities, could not be ; and in this respect, I suppose, we are distinguished, as well as other nations ; and I have before taken notice, that if one nation be by nature more distinguished in this respect than another, as they will, by that means, gain more money than such other nations, so the prices of all their commodities and labour will be higher in such pro¬ portion, and consequently, they will not be richer or more powerful for having more money than their neighbours. “ But, if we import any kind of goods cheaper than we can now raise them, which otherwise might be as well raised at home, in this case, undoubtedly, we ought to attempt to raise such commodities, and thereby furnish so many new branches of employment and trade for our own people, and remove the * [ Principles of Trade , sect. 38; Works, by Sparks, Yol. IT. p. 401.] CHAP. III. — OF TRADE. (§ 1.) 35 inconvenience of receiving any goods from abroad, which we can anywise raise on as good terms ourselves ; and, as this should be done to prevent every nation from finding their account with us by any such commodities whatsoever, so this would^more effectually shut out all such foreign goods than any law can do. “ And as this is all the prohibitions and restraints whereby any foreign trade should be obstructed, so, if this method were observed, our gentry would find themselves the richer, notwith¬ standing their consumption of such other foreign goods as, being the peculiarities of other nations, we may be obliged to import. For if, when we have thus raised all we can at home, the goods we import after this is done cheaper than we can raise such goods ourselves, (which they must be, otherwise we shall not import them,) it is plain the consumption of any such goods cannot occasion so great an expense as they would, if we could shut them out by an act of parliament, in order to raise them ourselves. “ From hence, therefore, it must appear, that it is impossible anybody should be poorer for using any foreign goods at cheaper rates than we can raise them ourselves, after wTe have done all we possibly can to raise such goods as cheap as we import them, and find we cannot do it ; nay, this very circum¬ stance makes all such goods come under the character of the peculiarities of those countries which are able to raise any such goods cheaper than we can do, for they will necessarily operate as such.”* The same author, in another part of his work, states a maxim of Erasmus Philips, which he calls a glorious one ; that “ a trad¬ ing nation should be an open warehouse, where the merchant may buy what he pleases, and sell what he can. Whatever is brought to you, if you don t want it you won’t purchase it, and if you do want it, the largeness of the impost won’t keep it from you.”t In this quotation, an argument for a free commerce all over * [ Money Answers all Things, &c., pp. 97-99. — See below, Vol. X. p. 89. J t [Ibid. p. 45.] 36 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. the globe, is founded on the same principles on which Mr. Smith has demonstrated the beneficial effects of the division of labour among the members of the same community. The happiness of the whole race would, in fact, be promoted by the former arrangement in a manner exactly analogous to that by which the comforts of a particular nation are advanced by the latter. A general division of labour would thus take place among the different tribes of men, prompting each to cultivate to the utmost whatever productions the nature of its situation pointed out as the most profitable. The consequence would be, an augmentation, on the whole, of the productive powers of human industry, and a proportional enlargement of the means of individual enjoyment. Though, however, these liberal and enlightened ideas con¬ cerning trade had long ago occurred to various writers of emi¬ nence, both in this country and on the Continent of Europe, it is only of late years, and particularly since the publication of the Wealth of Nations , that they have obtained a complete triumph, in the judgment of all candid and well-informed men, over the selfish but deep-rooted prejudices of the ancient system. Attempts, indeed, are still occasionally made to mislead the multitude on various particular questions connected with the general principles of freedom, but by not one writer of respect¬ able talents and character, who has appeared since the time of Mr. Smith. On the contrary, all over Europe, the uniformity of opinion on this fundamental doctrine of Political Economy becomes every day more and more prevalent, even among those who differ most widely on other branches of the science. In England, in particular, the most honourable testimony to the soundness of Mr. Smith's speculative principles, has been re¬ peatedly borne by the leaders of the two great parties which have so long divided the nation, and they have not been alto¬ gether without some practical influence on the measures of our government. In what light the same system is now viewed by those politicians abroad, who are the most friendly to the interests of this country, may be collected from the work of CHAP. III. — OF TRADE. (§ 1.) 37 Mr. Gentz, On the State of Europe before and af ter the French Revolution , — an author certainly entitled to a high rank among the speculative statesmen of the present day, and who has drawn on himself no small share of odium from his countrymen for his supposed partiality to the public measures of Great Britain since the fall of the French monarchy. “ Le veritable interet de TEurope prise en masse demande toujours le plus grand developpement possible des forces et des facultes de chacune des nations qui en font partie. Si la Russie et le Portugal emploient des capitaux et des ouvriers Anglais pour vivifier leurs fabriques interieures, une circonstance si peu naturelle suppose un vice quelconque dans le systeme de leur industrie ou rneme une organisation entierement defectu- euse si ces defauts pouvaient disparaitre, non seulement les nations qui y sont immediatement interessees y trouveraient leur avantage, mais encore en vertue de renchainement general qui lie toutes les forces productives de TEurope entr’elles, cet avantage rejaillirait sur toutes les autres nations. “ Mais tant que cette amelioration radicale n aura pas lieu, il est evidemment et incontestablement avantageux, non seule¬ ment pour les pays qui ont besoin de travail et de capitaux etrangers, mais meme pour le systeme general de l’industrie Europeenne, que les forces et les moyens de lAngleterre sup- pleent a ce que manque ailleurs. Le mal ne serait-il pas infini- ment plus grave, si ces champs de l’activite humaine, que cultivent et fecondent aujourdhui le travail et les capitaux Anglais, demeuraient entierement sans culture P Ce mal la serait absolu, celui-ci n est que relatif ; celui-ci n’est un mal qifen tant qu il en suppose d autres plus reels ; a tout autre tigard il est un bien.”* In another passage of the same book, he avails himself of the same doctrine, in replying to the systematical and accredited attempts which have been made of late years, by various French writers, to hold up to the general indignation of the world the commercial and maritime greatness of this country. u II est de Tinteiet bien entendu de l’Europe que toutes les * | De V Etat de l' Europe, &c., Partie III. chap. iv. p. 338, seq., orig. edit.] 38 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. parties qui la composent, que tous les Etats cultivateurs, manu- facturiers on commercans parviennent au plus haut degre de prosperity possible. II est done, et il sera dans toutes les cir- constances, de Finte'ret bien entendu de l’Europe, que ebaque nation participe a la richesse generale de l’univers, et par con¬ sequent aussi aux possessions coloniales et au commerce des deux Indes, autant, et s’il se peut, ni plus, ni moins, que le demandent sa situation particuliere, les besoins de son Indus¬ trie, ses dispositions, ses facultes, et le developpement le plus complet de toutes ses forces productives. “ Sous ce point de vue eleve, ce sera toujours le veeu non seulement de Fami de Fhumanite qui s interesse au bien de tous les peuples, mais encore de Fhomme d’etat eclaire, qui connait Fenchainement des lois qui forment Feconomie generale de l’univers, qua la tin de la guerre actuelle, toute nation propre au commerce maritime rentre en jouissance de sa juste mesure de domination, de commerce et d’industrie coloniale. Mais qu’on se garde bien de confondre ce point de vue eleve, avec celui non moins faux que retreci, qui sert de base aux plaintes qu’on entend s’elever de toute part contre la superiority com- tnerciale des Anglais. Le premier est entierement etranger aux auteurs de ces plaintes. S’il avait pu etre saisi, s’il avait pu etre seulement soupconne par la multitude, il y a longtemps que les declamations contre FAngleterre auraient cesse de se faire entendre.”* Of these attempts, that which has excited the most general attention is an anonymous tract published at Paris in the latter part of the year 1800, under the title of L’Etat de la France a la fin de Tan VIII. The reputed author of this publication is M. Hauterive. In opposition to his reasonings M. Gentz endeavours to show, with great force of argument, that there is gradually established, in the progress of commerce, a reciprocity of interests among nations as well as among indi¬ viduals ; that the commercial greatness of England is, in reality, an active principle of the industry, and a fruitful source of the present and future riches of all nations ; that the only method * [Ibid. p. 320, seq., orig. edit.] CHAP. III. — OF TRADE. (§ 1.) 39 of diminishing that greatness, which is either just or expedient, is to promote and encourage the same activity in other countries ; and that the project of destroying by violence the foundations of Britain’s prosperity, must ultimately prove its authors to be enemies to the general welfare of Europe. The following remarks, which form part of M. Gentz’s dis¬ quisitions on tins article, may convey a general idea of the spirit which animates this very able performance, and may furnish no unsuitable appendix to the faint outline which I have endeavoured to give of Mr. Smith’s doctrines with regard to the freedom of trade : — “ Une amelioration dans V administration interieure de tous les Etats, une legislation sage et liberate, plus d’attention a veiller aux interets du commerce et de l’industrie, a approfondir les sources de la veritable prosperity des nations. Toutes ces propositions, tous ces plans d’une reforme fondamentale dans le systeme economique de l’Europe, sont surs d’obtenir le suffrage de tous les gens eclaires comme de tous les amis du bien. Beni soit le gouvernement qui les embrassera dans toute leur eten- due ! et graces soient rendus a l’ecrivain qui aurait re^u assez de force et d’eloquence en partage, pour arracher a leur assou- pissement ceux qui jusqu’ici ont manque ou de sens pour les comprendre, ou de volonte pour les mettre en pratique ! C’est avec ces armes, mais avec elles seules que l’Europe doit com- battre l’Angleterre ! Sans doute que le resultat d’une pareille lutte ne repondra ni aux attentes malicieuses de l’envie, ni aux vceux insenses de la credule ignorance, d’une politique mercan¬ tile mal entendue, d’une cupidite qui se contredit et se detrait elle-meme, en courant apres des avantages chimeriques. La superiority commerciale des Anglais ne sera pas aneantie par cela que toutes les autres nations de l’Europe s’eleveront ii un plus haut degre de perfection. Mais toutes possederont ce qui leur revient : toutes par un sage et libre emploi de leur activite deployeront les forces qui leur sont propres, dans l’ordre, dans le degre et sous les conditions que la nature et leur position leur ont assignes ; toutes seront grandes, toutes seront fortes, toutes seront puissantes, et de leur propre grandeur, et force et 40 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. cle la grandeur de toutes les autres. L’Europe s’elevera sans que pour cela l’Angleterre s’abaisse, et les hommes clairvoyans de tous les pays auront peine a comprendre comment il put jamais exister un temps, ou Ton pensait que la richesse des uns entrainait necessairement 1’appauvrissement des autres.”* In stating the substance of Mr. Smith’s argument for the freedom of trade, I took notice of an exception to his general rule, which he himself has admitted, where a particular sort of industry is necessary for the defence of the state. It is upon this ground that he expresses his approbation of the monopoly of the trade with Great Britain, which has been secured to our sailors and shipping by the Act of Navigation. On the same ground, I also observed, that a plea had been lately rested for a relaxation of this abstract principle of Political Economy, in favour of the particular employment of capital and industry, which has for its object the supply of native oak for the purposes of our naval demand ; [supra, p. 25, seq.^\ and I expressed my doubts how far this plea would be found, upon examination, to be tenable. As it is a question which was much agitated some years ago, and is in itself of considerable importance, a few re¬ marks in support of that opinion, which I have already hinted, as most agreeable to my own sentiments, cannot be considered as a digression altogether foreign to our present employment. The leading positions to which I wish to direct your attention, cannot be better stated than in the words of the Keports drawn up by the Commissioners, some years ago, appointed to inquire into the state of the woods, forests, &c., of the Crown. Of these Reports , a series from 1787 to 1793, has been submitted to the Legislature, and certainly contains some very interesting information on the present subject of inquiry. The Commis¬ sioners were Sir Charles Middleton, (now Lord Barham,) Mr. Call, and Mr. Fordyce, the first and last of whom are now members of a board established for superintending the civil affairs of the navy, which has resumed the inquiry that had previously been prosecuted by the Commissioners. The passage which I am first to quote, is from the Eleventh '* [Ibid, pp, 348, 349, orig. edit.] CHAP. III. — OF TRADE. (§ 1.) 41 Report ; and I do this with great pleasure, as it appears to state one of the strongest cases in which a departure from general principle would seem, on a superficial view, to be not only expedient, but absolutely necessary. — “ From the answers we have received from each county,” say the Commissioners, “ it will be found that there has been, within memory, a great decrease of oak timber, of all sizes, in every part of England ; but that great naval timber has decreased more than any other ; and timber in hedgerows, which is the most valuable for naval uses, in a still greater proportion than timber growing in woods ; that the stock of great timber is now so much, and so generally diminished, in most countries, that they will not be able to continue to furnish so large a supply as they have done of late years ; that foreign fir timber is now much more used than formerly, particularly in house building ; that the price of underwood has risen, notwithstanding the more general use of coal for fuel ; and that in some countries it is not uncommon to fell the oak trees when young, not suffering them to stand so long as to be of use to the navy, for fear of their overshading and destroying the underwood : that notwithstanding the advance in the price of timber, tillage is gradually extended, and the quantity of wood-land lessened ; and that the planta¬ tions which are now made, are more generally for ornament than use, and of quick growing trees, in preference to oak for the navy.” In a former Report , [the Thirds the scarcity of great timber had been accounted for on a principle somewhat more general and refined, and which, though the Commissioners, perhaps, lay too great stress upon it, must, I think, be allowed to be not altogether destitute of solidity. After stating it as a fact ascertained by experience, that the addition in the demand for naval timber does not produce a proportional supply, they observe that the reason is obvious. “ An oak must grow an hundred years or more before it comes to maturity ; but the profits arising from tillage or pasture are more certain and im¬ mediate, and perhaps as great ; it cannot, therefore, be expected, that many private individuals will lay out money on the expec- 42 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. tation of advantages which they themselves can have no chance to enjoy ; commerce and industry seek for, and are supported by, speedy returns of gain, however .small ; and the more generally the commercial spirit shall prevail in this country, the less probability there is that planting of woods for the advantage of posterity will be preferred to the immediate profits of agriculture/' In reply to this observation, a late writer, Sir Frederick Morton Eden, denies completely the general principle, that an article will not be cultivated because it requires a hundred years to bring it to perfection. “ Acorns and wheat will, in general, be sown with the same view ; namely, that the capital em¬ ployed in their culture shall be replaced with an adequate profit. It is not necessary, either in trade or agriculture, that the returns should be annual. In many instances, several years must pass away before any return, and that uncertain in amount, can be expected. In the cultivation of underwood and hop-poles, from ten to twenty years must elapse before any crop can be obtained. Many cases of enclosing, draining, and manuring, might be pointed out, in which a still longer period will be necessary to reproduce the capital invested with an ade¬ quate profit. If’ when timber is twenty years old, the owner finds, that by letting it stand twenty years longer, or, in other words, by re-investing its value in growing timber, he can at the end of the term obtain an adequate profit, he has a suffi¬ cient inducement to let his trees grow ; and on the same prin¬ ciple, the owner of trees eighty years old will let them stand till they are one hundred years old. But the price of great timber is too low, compared with the price of other home pro¬ ducts, to produce cultivation/'* I have seldom met with a more illogical piece of reasoning than what I have just quoted from this very accurate writer. The proposition to be proved is, that an article will not be the less cultivated that it requires a hundred years to bring it to maturity. To prove this, the author remarks, that on the same * [Add r ess on the Maritime Mights of Great Britain, Part III. p. 92, seg. second edition.] CHAP. HI. — OF TRADE. (§ 1.) 43 principle on which a proprietor who found timber twenty years old on his estate, has a sufficient inducement to let it grow twenty years longer; by the prospect of additional gain at the end of that period, one who has trees of eighty years standing will he disposed to let them remain a hundred. The justness of this observation cannot be disputed ; but still the question remains, What inducement has a person to plant acorns at pre¬ sent, the returns arising from which will not be produced for a hundred years ? There is, surely, a very distant analogy between this and the sowing of wheat and other grain. Nor can it well be affirmed, that both are done with the same views. On the contrary, I may venture to assert, that, with the excep¬ tion of a few individuals, whose family pride interests them in the greatness of their children's grandchildren, and, I am afraid, I may add, of the fewer still whose conduct is influenced by remote views of public utility, pecuniary profits, not to be reaped for a century to come, present too faint an object for the imagination to deserve a place among the ordinary motives of human action. Abstracting altogether, however, from this consideration, I perfectly agree with the author in thinking, that the established price of great timber is too low, compared with that of the other productions of industry, to indemnify a proprietor for the expensive and tedious process of cultivation, — a proposition sufficiently proved by the acknowledged fact, that foreign countries, notwithstanding the high import duties, which almost amount to a premium in favour of the home growers, are enabled to enter into a successful competition with the timber growers of Great Britain. I differ from him only in thinking, that an increase in the price would operate with any influence as an additional motive to the cultivation. The commissioners of the land revenue seem plainly to be of the same opinion with that which I have just stated, from the means they propose to secure the future supply of timber. Their suggestion is, that such parts of the royal domains as would, on an adjustment of the various rights claimed in them, be allotted to the Crown, and which they compute at sixty or seventy thousand acres, 44 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. should be enclosed and planted, on the presumption that the land so enclosed would, after one hundred years, produce an annual supply of fifty thousand square loads of timber. The demand for timber for the national and private shipping at present, I may observe, is computed to exceed seventy thousand square loads a year. The authors of this plan are all too well informed men not to have perceived how widely it deviates from the most indubi¬ table and important principles of Political Economy ; and that, in proposing to direct forcibly a proportion of the national capital to the production of an article which can be imported cheaper from abroad, it violates principles, of which Mr. Smith is allowed to have established the wisdom with demonstrative evidence. In recommending, too, a forest system, which would have the effect to continue, for an immense number of years, a large proportion of the land of the country in a comparatively unproductive state, it aims a blow at the agricultural resources of the country, which, according to the general opinion, it ought now to be the leading object of our policy to extend ; while the idea of managing this great experimental farm by the officers of the Crown, is reprobated by the experience of all ages and nations, with respect to the administration and improve¬ ment of royal domains. Notwithstanding of these considerations, however, if it could be proved that the plan would be likely to accomplish its object, and still more if it could be established, that no other plan would be equally efficacious for securing the national safety and independence, undoubtedly, these general principles ought to give way, in the mind of every prudent statesmen, to what Mr. Smith himself has accounted an object of higher value. But that the plan is not more unsound in principle, when considered m connexion with the other parts of our political arrangements, than it is nugatory in point of efficiency, even for the accom¬ plishment of its specific object, a moment's attention will satisfy even the most superficial inquirer. On this head, the following observations of Sir Frederick Morton Eden appear to me to be quite decisive : — “ Such a plan, it is obvious, is not calculated to CHAP. III. — OF TRADE. (§ 1.) 45 furnish any supply of timber to the navy during the present generation, except so far as it may preserve young trees already planted, and promote their advance to maturity. The Com¬ missioners observe, that although the quantity of timber which has been furnished from all the forests during the present reign has not exceeded two thousand loads a year, square measure, they have no doubt that as soon as a settlement shall have been made with the Commissioners, or other ‘effectual means taken for increasing the stock of timber, the annual fall in the forests may be raised to nearly four thousand loads, square measure, and be continued at that rate, without intermission, until the new plantations shall be arrived at maturity/ “ Although, therefore, it should be admitted, that by the arrangement proposed, four thousand square loads would be annually secured from the royal forests for the next hundred years, the demand of the navy, if taken at seventy thousand loads a year, (the supposed present consumption,) or even at fifty thousand loads, (the average annual consumption twenty years ago,) would require, in the first case, sixty-six thousand loads, or more than sixteen times the quantity furnished by the royal forests ; and in the latter case, forty-six thousand loads, or nearly twelve times the quantity furnished by the forests to be supplied from private property or commerce. But as the Commissioners very justly conclude, 1 that the gradual diminution of the wood and timber in the country is to be expected in any future stage of its improvement/ it is obvious that, for the next hundred years, (even without that increased demand for naval timber, which must as naturally attend the improvement of the country,) the supply from the royal forests being limited, and the supply from private pro¬ perty being gradually diminished, Government must necessarily look to commerce, not only for the motives, but the means, of ship-building ; and under these circumstances, it becomes highly important to consider, whether it is not repugnant to the sound principles of Political Economy to adopt a forest system, which will have the effect of continuing sixty thousand or seventy thousand acres of fine land in maritime mortmain, 46 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. and of forming an experimental farm of that extent, to be managed by the officers of the Crown ; for the immediate object of securing, from the forests, only a twelfth or sixteenth part of the present consumption, and for the remote object of possibly providing, after one hundred years, the whole supply that may then be wanted/'* I have entered into this long discussion, chiefly to have the satisfaction of quoting a very short extract from a note written by the Chairman of the Quarter Sessions of Bury, in the county of Suffolk, in answer to the inquiries of the Commissioners concerning the means of increasing the quantity of timber, and which appears to me to form a very striking contrast to the passages already quoted from their Reports, both in its practical good sense, and in its exact coincidence with the most en¬ lightened views of Political Econom}L “ England possessed in the past age a great plenty of oak. Why ? Because cultivation was in a barbarous state. It is the improvement of the kingdom, a thousand times more valuable than any timber can ever be, that has wrought the very good and proper diminution of oak ; and it is to be hoped the diminution will continue, for if it does not, the improve¬ ment of our soil will not advance. While we are forced to feed our people with foreign wheat, and our horses with foreign oats, can raising oak be an object ? The average oak of Suf¬ folk of a hundred years growth is worth £5 ; and let it grow in a hedge, wood, or a field, it has at that age done £10 worth of mischief. There are soils (not in this county) singularly favourable to the growth of oak, and yet yielding not more than eight or ten shillings an acre. On such, oak would pay, but the crop to be timber only, and no cattle ever admitted. But where is the owner who will sow a crop of a hundred years P Vanity does something : it does at present more than it ought to do, by planting soils not of the right sort. “ The scarcity of timber ought never to be regretted, for it is a certain proof of national improvement ; and for royal navies, countries yet barbarous are the right and only proper * [Ibid. pp. 94-96.] 47 CHAP. HI. — OF TRADE. (§ 2.) nurseries. Buy oak, as you buy fir to build your houses. There is oak enough within reach of the Adriatic for a million of ships of a hundred guns each. Proposals were made (as I have been informed) to the Administration concerning those woods, as a supply for England, but no ear given, as they had it elsewhere cheaper/' — (End of interpolation from Notes.) [SECT. II.] — OF THE CORN TRADE. In the slight view which I gave, at our last two meetings, of Mr. Smith's reasonings in favour of an unlimited freedom of commerce, I purposely avoided all mention of the Corn Trade, as I was anxious to confine myself as much as possible to an illustration of general principles, without entering into the peculiarities of those cases, which, in the opinion of some, require an appropriated system, of regulations. Of this im¬ portant subject, Mr. Smith has treated very ably in a long digression, which he has introduced in his Chapter on Bounties A It appeared to me, however, to be more consistent with a dis¬ tinct and systematical arrangement, — First , to state the general doctrine ; and afterwards to consider what limitations of it may be necessary in particular combinations of circumstances. The Corn Trade, besides, being the most important of all the branches of commerce, seemed of too great magnitude to be considered merely as an appendix to a disquisition concerning one particular article of the Commercial system ; more espe¬ cially, as it has no peculiar connexion with this article, but what arises from the accidental and local policy of Great Britain. I propose, therefore, to consider this branch of com¬ merce separately ; flattering myself that, by this deviation from Mr. Smith’s plan, I may indulge myself, without impropriety, in some illustrations which might have been regarded as tedious, if introduced in the course of an incidental or episodi¬ cal discussion. The trade of the corn merchant is divided by Mr. Smith into four different branches, which, though they may sometimes he * [ Wealth of Nations, Book TV. chap. v. ; Yol. II. p. 263, seq., tenth edition.] 48 POLITICAL ECONOMY. - PART I. — BOOK II. — NAT. WEALTH. all carried on by the same person, are in their own nature four separate and distinct trades. These ar first : the trade of the inland dealer; secondly , that of the merchant importer for home consumption ; thirdly , that of the merchant exporter of home produce for foreign consumption ; and, fourthly , that of the merchant carrier, or of the importer of corn for future exportation. [subsect, i.] — Of the Inland Corn Trade. Of the different branches of the Corn Trade, that which is carried on at home is incomparably the most important. According to the computation of the author of the Tracts upon the Corn Trade , [Charles Smith,] founded on a state¬ ment of imports and exports, during a long course of years prior to 1765, the proportion of the average quantity of all sorts of grain imported into Great Britain, to that of all sorts of grain consumed, does not exceed that of one to five hundred and seventy. The average quantity of all sorts of grain exported from Great Britain does not, according to the same author, exceed the one and thirtieth part of the annual produce. Even in the highest year ever known, the year 1750, when the amount of the exports was 1,500,220 quarters, it did not exceed the seed one- twelfth part, supposing it one-tenth of the growth.1 These proportions, indeed, can by no means be relied on as perfectly accurate ; and, in general, as Mr. [Adam] Smith re¬ marks,* little stress ought to be laid on the results of what is commonly called Political Arithmetic. There can, however, be no doubt that the difference in point of extent between the foreign and the home trade in Corn is immense ; and the numbers I have quoted may at least serve to convey an idea of the opinion of a very judicious and well-informed writer on the subject. That in the case of the inland trade of Corn, the accommo¬ dation of the zohole community is most effectually consulted by 1 Pp. 144, 145. [Edition 1766.] * [ Wealth of Nations , Book IV. chap. v. ; Vol. II. p. 310, tenth edition.] CHAP. III. — OF TRADE. (§ 2.) 4(J permitting an unlimited liberty of transportation, appears from this, — that even in years of the greatest scarcity, the interests of the inland dealer, and of the great body of the people, must be one and the same. The truth of this principle, it must be owned, is not self-evident ; on the contrary, it is very strongly opposed by popular prejudices. But this only proves how expedient it is for a wise Government, not only to sanction by law the liberty of this branch of commerce, but to employ the most vigorous measures to render it effectual, by protect¬ ing the just rights of individuals against those unenlightened descriptions of men, who, from a partial or mistaken view of their own interests, may be disposed to infringe them. The interests of the inland dealer (it was just now said) and that of the great body of the people, how opposite, soever, they may at first sight appear, must be at all times, even in years of the greatest scarcity, exactly the same. In proof of this, it is sufficient to observe, that the most effectual way in which the dealer can in a year of scarcity serve the public, is by raising the price of his corn as high as the real scarcity of the season requires, without raising it beyond this limit ; and that this is the general principle on which he will act to the best of his knowledge, we have complete security in that pru¬ dential regard which we may presume every trader has to his own emolument. It is abundantly obvious, that in a year of scarcity it is the interest of the people that their daily, weekly, and monthly consumption should be proportioned as exactly as possible to the supply of the season ; and for this purpose, what means so simple and infallible as those which the corn dealer naturally employs ? “ Where the produce of an year/’ says Mr. Hume, “ falls so far short as to afford full subsistence only for nine months, the only expedient for making it last all the twelve, is to raise the prices, — to put the people by that means on short allowance , — and oblige them to save their food till a more plentiful season/' By raising the price, accordingly, the corn-dealer discourages the consumption, and puts everybody, more or less, but par- VOL. IX. d 50 POLITICAL ECONOMY. — PART 1. — BOOK II. — NAT. WEALTH. ticularly the inferior ranks of people, upon plans of economy and good management ; while, at the same time, his knowledge of the state of the crop, and of his daily, weekly, and monthly sales, enables him better than any other person to regulate the price according to the circumstances of the country. The con¬ duct which is thus prescribed to him by his own interest, is very happily compared by Mr. Smith to that of the prudent master of a vessel, when, from an apprehension of a want of provisions, he puts his crew on short allowance.* Though, from an excess of caution, this may be sometimes done, both in the one case and the other, without any real necessity, yet the inconveniences which the parties concerned are likely thus to incur, are inconsiderable in comparison of the danger, misery, and ruin to which they might eventually be exposed by a less provident conduct. In the case of the corn-dealer, his own interest acts here as a most powerful check on those exorbitant demands which might be suggested by a more unenlightened avarice not only as he will naturally strive to diminish as much as he can that popular odium which is attached to his profession, but as he must be sensible of the hazard of having on his hands a quantity of corn at the end of the season, which he might be obliged to dispose of afterwards at a much greater disadvantage. Were it possible indeed for one great company of merchants to possess themselves of the whole crop of an extensive country, Mr. Smith acknowledges that it might be their interest to deal with it as the Dutch are said to do with the spiceries of the Moluccas, to destroy or throw away a considerable part of it, in order to keep up the price of the rest. But it is scarce possible, even by the violence of law, to establish such an extensive monopoly with regard to corn ; and whenever the law leaves the trade free, it is of all commodities the least liable to be engrossed or monopolized by the force of a few large capitals, which buy up the greater part of it. Not only its value far exceeds what the capitals of a few private men are capable of purchasing ; but supposing they were capable of * [Wealth of Nations, Book IV. chap. v. ; Vol. II. p. 292, tenth edition.] CHAP. III. — OF TRADE. (§ 2.) 51 purchasing it, the manner in which it is produced renders this purchase altogether impracticable. As in every civilized country it is the commodity of which the annual consumption is the greatest, so a greater quantity of industry is annually employed in producing corn than in producing any other commodity. When it first comes from the ground, too, it is necessarily divided among a greater number of owners than any other commodity ; and these owners can never be collected into one place, like a number of independent manufacturers, but are necessarily scattered through all the various corners of the country. These first owners either immediately supply the consumers in their own neighbourhood, or they supply other inland dealers who supply those consumers. The inland dealers in corn, therefore, including both the farmer and the baker, are necessarily more numerous than the dealers in any other com¬ modity, and their dispersed situation renders it altogether im¬ possible for them to enter into a general combination. If, in a year of scarcity, therefore, any of them should find that he had a good deal more corn upon hand than, at the current price he could hope to dispose of before the end of the season, he would never think of keeping up this price to his own loss, and to the sole benefit of his rivals and competitors, but would imme¬ diately lower it, in order to get rid of his corn before the new crop began to come in. The same motives, the same interests, which would thus regulate the conduct of any one dealer, would regulate that of every other, and oblige them all to sell their corn at the price, which, according to the best of their judgment, was most suitable to the scarcity or plenty of the season. With respect to the dearths and the famines which, during the course of the last three centuries, have occasionally afflicted the different countries of Europe, Mr. Smith lays it down as a general proposition, “ that a dearth never has arisen from any combination among the inland dealers in corn, nor from any other cause but a real scarcity, occasioned sometimes, perhaps, and in some particular places, by the waste of war, but in by far the greater number of cases by the actual failure of the crops in consequence of the badness of the season ; and that a 52 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. famine, has never arisen from any other cause than the violence of Government attempting, by improper means, to remedy the inconveniences of a dearth.”* In an extensive corn country, between all the different parts of which there is a free commerce and communication, the scarcity occasioned by the most unfavourable seasons can hardly ever be so great as to produce a famine ; and the scantiest crops, if managed with frugality and economy, will maintain through the year the same number of people that are commonly fed in a more affluent manner by one of moderate plenty. Not only does the weather differ widely, in most instances, in dif¬ ferent parts of an extensive territory ; but even when it does not, the mischief occasioned by excessive droughts, or excessive rains in lands which are naturally disposed to be too dry or too wet, is always compensated in some degree by the advantage gained in soils of an opposite description. “ Lorsque les recoltes manquent en quelque lieu d’un grand Empire, les travaux du reste de ses provinces etant payes d'une heureuse fecondite, suffisent a la consommation de la totalite. Sans sollicitu.de de la part du gouvernement, sans magazins publics, par le seul effet dune communication libre et facile on n’y connoit ni disette ni grande cherte.”1 If this remark fails at all, it is in rice countries, where the crop not only requires a very moist soil, but where, in a certain period of its growing, it must he laid under water. It is in such countries, accordingly, that the effects of excessive drought are most severely felt. When the Government, in order to remedy the inconveni¬ ences of a dearth, orders all the dealers to sell their corn at what it supposes a reasonable price, it either hinders them from bringing it to market, which may sometimes produce a famine even in the beginning of the season ; or it encourages the people to consume it so fast as must necessarily produce a famine before the end of the season. The only effectual secu¬ rity against these evils is an unlimited liberty of the corn trade ; and the only respect in which Goverment is called upon to in- * [Ibid. p. 295.] 1 TJieorie de Luxe, Tom. I. p. 5, quoted by Young in bis France, p. 482. CHAP. HI. — OB" TRADE. (§ 2.) 53 terpose its authority, is to maintain and protect this liberty against those assaults to which it is so peculiarly liable from the prejudices and passions of the unenlightened multitude. In truth, there is no branch of trade whatever which at once deserves so much, and requires so much the protection of law ; and there is hardly any of the interpositions of law which demand a greater degree of steadiness and vigour on the part of the magistrate. The general and the permanent interests of the community ought in this, as in all other cases, to be con¬ sulted in opposition to the suggestions of a more partial bene¬ ficence ; and the temporary indignation and odium of the people disregarded, in order to establish a solid claim to their lasting gratitude. In years of scarcity, those who attend only to the pressure of the present moment, are apt to impute their distress to the avarice of the corn merchant, who becomes, of course, the object of their resentment and hatred, and who is thereby exposed to the danger of having his magazines plundered and destroyed. It is in years of scarcity, however, when prices are high, that the corn merchant expects to make, and is entitled to make, his principal profit. He is generally in contract with some farmer to furnish him for a certain number of years with a certain quantity of corn at a certain price ; a price which will be naturally settled according to the ordinary or average rate of the markets. In years of scarcity, therefore, the corn merchant buys a great portion of his corn for the ordinary price, and sells it for a much higher. That this extraordinary profit, however, is no more than sufficient to put his trade upon a fair level with other trades, and to compensate the many losses which he sustains upon other occasions, both from the perishable nature of the commodity itself, and from the frequent and unforeseen fluctations of its price, seems evident enough from this single circumstance, that great fortunes are as seldom made in this as in any other trade. On the contrary, in this as in the other branches of trade, which form the employment of the speculative merchant, bankruptcies are much more numer¬ ous than in those where the supply of the commodity can be 54 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. more accurately and uniformly adjusted to the demand. In consequence of this circumstance, added to the effects of popular prejudice, merchants of character and fortune are averse to enter into the Corn Trade, and abandon it to an inferior set of dealers, destitute of a sufficient capital to deserve the credit of the farmers, as well as of that liberality of mind, and those enlarged views of their own interests, which are commonly to be found in men accustomed to the operations of an extensive commerce. The prejudices which the lower ranks of men are apt to en¬ tertain in all countries, against a trade so peculiarly beneficial to themselves, instead of being discountenanced by the wisdom of law, were unfortunately encouraged and strengthened by those narrow maxims of Political Economy which influenced for a course of ages the policy of modern Europe. Of these maxims a leading one was, that the people would buy their corn cheaper of the farmer than of the corn merchant, who, it was supposed, would require over and above the price he paid to the farmer, an exorbitant profit to himself. It was thought expedient, accordingly, to hinder as much as possible, a mid¬ dleman of any kind from coming in between the grower and the consumer. Another circumstance too, it is probable, had some 'influence in dictating this policy. For many years after the Conquest, the greatest part of the inland trade of England was carried on in markets and fairs ; all bargains of sale being prohibited excepting in public markets and in boroughs, in order to pre¬ vent theft. A very considerable part of the revenues of the Crown arose from the duties payable to the king upon the goods thus brought to sale, and similar duties were enacted by the barons on the goods sold at the fairs within their jurisdictions.1 When the farmers and merchants were bringing their corn and other necessaries, to be sold at the markets and fairs, people met them by the way, and purchased their provisions, in order to retail them at a higher price. By this means the 1 Hume, Yol. TI. p. 126. — Dirom, p. 29. CHAP. III. OF TRADE. (§ 2.) 55 king and the lord of the manor lost the several duties payable to them ; while, at the same time, the price was raised upon the inhabitants, by lessening the quantity of provisions brought to market. Such were the original forestallers , against whom severe penalties were enacted, as the trade they carried on seemed to he equally prejudicial to the privileges of the great and to the general interests of the community. In process of time the description of a forestaller came to be farther extended to “ any person who should buy” any mer¬ chandise or victual, coming towards any fair or market, or towards any city, port, creek, or road, of England or Wales, from beyond sea, to be sold ; or who should make any bar¬ gain for having the same, before the merchandise or victuals should be in the market to be sold ; or who should make any motion for enhancing the price ; or should move any person coming to the market to forbear to bring the things to be sold/' In the same statute from which these words are quoted, (the 5th and 6th Edward VI.,) the title of regrator is applied to “ any person who shall by any means regrate, obtain, or get into his possession, in any fair or market, any corn, wine, fish, butter, cheese, &c., that were brought to any market in England or Wales to be sold, and shall sell the same in any fair or markets holden or kept in the same place, or in any other fair or market within four miles thereof.” It is added, that “ a person who shall engross, or get into his hands by buying, con¬ tract, or promise-making, any growing corn in the fields, or any other corn or grain, butter, cheese, fish, or other dead victuals whatever, with intent to sell the same again, shall be holden or reputed an engrosser .” The penalties for these offences, as might be expected from the spirit of the age, are abundantly severe. “ That an engrosser (for example) should for the first fault suffer two months' imprisonment, and forfeit the value of the corn ; for the second, suffer six months' imprisonment, and forfeit double the value ; and for the third, be set in the pillory, suffer imprisonment during the king's pleasure, and forfeit all his goods and chattels.” 56 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. In Scotland, laws to the same purpose were made against forestallers and regrators ; and although the word engrosser does not appear in the laws, the description of an engrosser is fully comprehended under that of the forestaller and regrator, In the case of forestalling, the third criminal act infers escheat of moveables, (1592, c. 148.) 1 The ancient policy of most other parts of Europe was similar, in this respect, to that of England and Scotland. The same principles which led our ancestors to attempt the suppression of the trade of the corn merchant, induced them to impose restraints upon the trade of those whom they called bidders or carriers of corn, — a trade which nobody was allowed to exercise without a license, ascertaining his qualifications as a man of probity and fair dealing. In general, their object plainly was to discourage, as much as possible, any middle-man of any kind from coming in between the grower and the con¬ sumer. On the important advantages arising from such an interven¬ tion, more especially from the trade of the extensive corn mer¬ chant, I shall have occasion afterwards to offer some observations. In the meantime, it may be worth while to remark, that this trade naturally arose from the improving agriculture of the country, and was a most unequivocal symptom of national prosperity ; and that it had plainly been suggested, in part, by the experience of those very calamities which it seemed, on a superficial view, to threaten, and against which it is, in fact, the only effectual remedy. In the earlier ages of English history, the trade of a corn- dealer seems to have been unknown ; nor, except in the Abbey Granges, do we meet with instances of corn being collected in large quantities.2 The natural con¬ sequence was, that the farmers without capital disposed of their crops at moderate prices soon after the harvest ; purchasers, who only looked to their immediate wants, having corn cheap, were naturally prodigal and improvident in the consumption. The price, therefore, almost invariably rose as the year advanced, and was frequently at an enormous height just before harvest ; 1 Erskine’s [Institutes,] p. 488. 2 Eden, On the Poor, Vol. I. p. 18. CHAP. III. — OF TRADE. (§ 2.) 57 and before a fresh supply could be obtained, the supply of the preceding year was often entirely exhausted. Stowe informs us, that in 1317, the harvest was all got in before the first of September, and that wheat, which had before been at £4 the quarter, fell to 6s. 8d., a twelfth part of that price. A detail of the prices of grain would furnish us with abundant proof, if proofs were wanting, of the extreme misery of those times, in which the only buyers of grain were the consumers. Five guineas a quarter is a price sufficiently grievous, even at a period when a labourer can earn 18d. a day; but between the Conquest and the accession of Edward the Third, the price of wheat varied from 8d. to £6, 8s. the quarter, to which almost incredible price (being equal to £19, 4s. of our present money,)1 it rose in 1270, and was attended with a famine. At this period, too, it must be remarked, a man s day’s work in harvest was valued at a penny, and out of harvest at a halfpenny. On the other hand, that the conclusion may not be pushed too far, it is necessary to recollect that wheat was not the general bread corn of the peasantry. From a valuation of the moveable pro¬ perty in the borough of Colchester, made in the year 1296, pre¬ paratory to levying a subsidy of a seventh, for carrying on the war against France, it appears that among the petty tradesmen and artificers of that period, almost every family was provided with a small store of barley or oats, usually about a quarter or two of each ; rye appears to have been very little used, and wheat scarcely at all. This circumstance is the more worthy of our notice, that it has been frequently overlooked by our economical writers, many of whom assume the price of wheat , when compared with the wages of labour, as a certain criterion for judging of the condition of the labouring classes at any given period. This, it is evident, can only hold good on the supposition, that this grain is wholly and entirely their ordinary food, which is not the case, even at this day, and was certainly very much otherwise in more early times. From the House¬ hold Booh of Sir Edward Cooke, it appears that in 1596, rye 1 Smith, Vol. I. p. 277. — [Book I. See the Table of Prices in the Wealth chap. xi. Yol. I. p. 288, tenth edition.] — of Nations, [Vol. I. p. 398, $eq.] 58 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. bread and oat-meal formed a considerable portion of the bread of servants even in great families. In 1626, barley bread is stated, in a grant of a monopoly from King Charles, to have been the usual food of the ordinary sort of people.1 Kay, even so late as the beginning of the present reign, it appears from the supple¬ ment to [Charles Smith’s] Three Tracts on the Corn Trade , [1766.] that above one-third of the nation ate bread made of oats, rye, or barley.* He adds, that “ some who have consi¬ dered the matter with great attention, are inclined to think, that in the year 1764, one-half of the people could not be supposed to feed on wheaten bread.” f Although, however, these considerations shew evidently the inaccuracy of many of our conclusions, founded on the price of wheat compared with the wages of labour, they do not invalidate the inference, formerly stated, [supra, p. 57,] of the extreme distress of the lower orders in 1270, and the other bad seasons already referred to. The fluctuations in the price of wheat must necessarily have been accompanied with corresponding (although, perhaps, not proportional) fluctuations in the prices of oats and barley, and whatever else formed the ordinary food of the people ; and these fluctuations were the obvious consequence of the corn trade being entirely in the hands of farmers , without the intervention of extensive corn-dealers between the grower and the consumer. The evils arising from this circumstance were no doubt much aggravated by the imperfect police which then existed. “ In the disorderly state,” says Mr. Smith, “ of England under the Plantagenets, who governed it from about the middle of the twelfth till towards the end of the fifteenth century, one district might be in plenty, while another, at no great distance, by having its crops destroyed, either by some accident of the seasons, or by the incursion of some neighbour¬ ing baron, might be suffering all the horrors of a famine ; and yet, if the lands of some hostile lord were interposed between them, the one might not be able to give the least assistance to the other.”2 1 Eden, On the Poor, Vol. I. p. 60, seq. 2 Vol. 1. p. 277, Irish edition. — [Book * [P. 182, seq.] f [Ibid.] I. chap. xi. ; Vol. I. p. 288, tenth edit.] CHAP. III. — OF TRADE. (§ 2.) 59 These two causes, it is obvious, operated precisely in the same manner, by interrupting that natural course of things which provides in the plenty of one part of the country a relief for the scarcity of another. They are, therefore, equally illustrations of the same general principle. In these calamitous times, it has been justly remarked, that the return of harvest must have been looked for with hardly less eagerness than that with which the Egyptian farmer is said to watch the overflowing of the Nile ; and it has been con¬ jectured, with considerable probability, that the enthusiastic joy with which the rustic feast of Harvest Home was anciently celebrated, arose from the circumstances of those ages, when a late crop or a bad season reduced the wretched cultivator to the extremity of want, and when the successful or unsuccessful management of this critical period decided the alternative of plenty or of famine. I have been led into these remarks by the consideration of the statute of Edward VI., against forestallers and regrators , — a statute which was expressly calculated to deprive the country of those resources against dearth and famine which nature has so liberally provided for it, in the variety of its soils and climates, combined with the circumstance of its insular situation. The rigour of this law was afterwards relaxed by several sub¬ sequent statutes, which permitted the engrossing of corn when the price of wheat should not exceed twenty, twenty-four, thirty- two, or forty shillings the quarter. At last, by the 15th of Charles II., the engrossing or buying of corn, in order to sell it again, as long as the price of wheat did not exceed forty-eight shillings the quarter, and that of other grain in proportion, was declared lawful to all persons not being fore¬ stallers, that is, not selling again in the same market within three months. All the freedom which the trade of the inland corn-dealer has ever yet enjoyed, was bestowed on it by this statute ; and, in the opinion of Mr. Smith, “ it has contributed more (not¬ withstanding all its imperfections) both to the plentiful supply GO POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. of the home markets, and to the increase of tillage, than any other law in the statute-hook/'* The statute of the 12th of the present king, which repeals almost all the other ancient laws against engrossers and fore¬ stalled, does not repeal the restrictions of this particular statute, which therefore still continue in force. It must also be remembered, that “ the engrossing of corn, as well as the engrossing of any other commodity, with intent to sell it at an unreasonable price, (notwithstanding the repeal of statutes concerning them by the 12th George III.,) is an offence in¬ dictable and fineable at Common Law ; the penalty for such offences being (as in other minute misdemeanours) discretion¬ ary fine and imprisonment.” That the restrictions, in the statute of Charles II. now re¬ ferred to, are absurd and impolitic, Mr. Smith has shewn very clearly ; but it is unnecessary to follow him into his reasonings on this subject, as the argument already stated for the freedom of the inland trade of corn, if it proves anything, leads to the general conclusion, that this freedom should be unlimited. It is pleasing to observe the gradual progress of light and liberality on these important subjects among men called to the administration of public affairs, and to perceive the influence which the writings of Turgot and Smith have insensibly assumed over the councils of nations.f The following quotation from a Representation of the Lords of the Committee of his Majesty’s Council for Trade , drawn up in the year 1790, states the substance of the foregoing argument so forcibly and con¬ cisely, that I cannot deny myself the pleasure of transcribing it. To those who are acquainted with the works of the two philosophers just mentioned, it is unnecessary for me to point out its striking coincidence with their writings, both in point of sentiment and of expression. * [Ibid. p. 309.] t [The preceding sentence stood ori¬ ginally thus:] — “Nor is it unamusing to those who reflect on the unrestrained abuse which the circumstances of our own times have so long encouraged in the ignorant and unprincipled, against the best benefactors of the human race, to perceive the secret influence which the writings of a Turgot and a Smith begin to assume over the councils of nations.” CHAP. IIT. — OF TRADE. (§ 2.) 61 “ The best market for corn in every country is the home market ; and the circulation of it within every kingdom ought to be free, so that the surplus of one part may supply the deficiency of the other, and that the price throughout the whole country may be brought as near as possible to a level. “ To facilitate the circulation of corn, this kingdom enjoys peculiar advantages, which arise from its situation as an island, from the number of its canals, and the excellence of its roads ; as by these the populous and manufacturing counties in some parts of the island, can draw the necessary supplies from other parts which are less populous, but more productive of corn. “ In other countries, magazines of corn are formed by their respective governments, or by the principal magistrates of great cities, as a resource in times of scarcity. This country has no such institution. The stores of corn are here deposited in the barns and stacks of wealthy farmers, and in the magazines of merchants and dealers in corn, who ought by no means to be restrained, but rather encouraged in laying up stores of this nature ; as after a deficient crop they are thereby enabled to divide the inconvenience arising from it as equally as possible through every part of the year ; and by checking improvident consumption in the beginning of scarcity, prevent a famine which might otherwise happen before the next harvest. The inland trade of corn, therefore, ought to be perfectly free. This freedom can never be abused. To suppose that there can be a monopoly of so bulky and perishable a commodity, dispersed through so many hands over every part of the country, is an idle and vain apprehension. The ancient laws of this kingdom, which, by a false policy, restrained the inland trade of corn, have in general been repealed. The 15th Charles II., which does not permit the buying corn to sell again, and the laying it up in granaries, except when the several sorts of corn are below certain prices therein mentioned, is the only law of this descrip¬ tion which will now be found in our statute-book, and ought certainly not to remain there any longer.”* * [In the Notes taken of this course another Report of a Committee of the in a subsequent year by Mr. Bridges, House of Peers is referred to, as liav- 62 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. In the same representation, indeed, there are to be found principles concerning the freedom of exportation, and some other articles in the corn trade, which are borrowed from a much more unenlightened system ; and on which I shall have occasion afterwards to make some remarks. But the progress of truth in eradicating prejudices is slow and gradual ; and we must console ourselves in the meantime, with observing in its progressive, though tedious advance, the certain presages of its future triumph. Having mentioned, in the quotation just now read from the Representation of the Lords of the Council on the Corn Trade , the institution of public magazines, I shall take this opportunity of remarking how very imperfectly they supply the place of an internal freedom of trade. Magazines can do nothing more than private speculators; they can only buy when corn is cheap, and sell when it is dear; but they do this at such a vast expense, and with so little economy, that if they do not take an equal advantage of profit with private speculators, they must demand an enormous tax to enable them to carry on their business ; and if they do take such profit, the people are never the better for them. Mr. Symonds, in his paper on the public Magazines of Italy, has proved them to be everywhere nuisances.1 In France, the prejudices against monopolizers ( Accapareurs ) seem to have been still more inveterate than in England ; and restraints imposed by the law upon the inland trade of corn, have been much more numerous and oppressive. The attempts which, in later times, were made to correct these prejudices, and to introduce a more enlightened policy on the subject, are intimately connected with the political history of that country, and with the fortunes of some distinguished political characters ; and, therefore, I shall make no apology for the length or minuteness of the following details, more especially as many of them afford additional proofs and illustrations of the general principles which have been already stated. ing been quoted by Mr. Stewart ; — necessary to adduce articulately.] tliat, to wit, on the Dearth in 1799- 1 Annals of Agriculture , Young’s 1800. This, however, it is not thought France, p. 483. CHAP. III. — OF TRADE. (§ 2.) 63 In the year 1763, under the administration of M. de Laverdi, a considerable step had been made towards an emancipation of this branch of commerce from the restraints which had so long fettered it;1 and, in particular, a freedom of trade, from pro¬ vince to province, had been established. But these indulgences were afterwards recalled by the Abbe Terray in 1770. At this time, M. Turgot was Intendant of Limoges, where he had experienced, in one of the poorest provinces of France, during two years of scarcity, the happy effects of maintaining, with all the influence and power which his station enabled him to command, that degree of liberty which the laws then allowed to the inland dealers in grain. The Minister of Finance having requested, on this occasion, the advice of the Intendants of the different Provinces, M. Turgot addressed to him Seven Letters , which are said to have formed a complete treatise on this important object of legislation.2 Of these Letters, only Four have been preserved;* the other Three having, by some unaccountable accident, been lost. The whole were composed in three weeks,3 during a tour which the author made through the province under his Intendance, and amidst the various minute avocations connected with his office. Some are even said to have been written in a single evening. And yet in this imperfect fragment, so hastily executed, he has left a lasting monument of the extent and justness of his political views, as well as of an admirable and almost unrivalled talent for a clear, methodical, and concise exposition of general principles. I think it may be questioned if the argument has been yet stated by any other writer with equal ability and force. As for M. Terray, we are told by Dupont in his Biographical Memoirs of Turgot , he u read the letters and admired them ; extolled in the warmest terms the information, the talents, and the courage of the author ; and concluded, by renewing the old pro¬ hibitive regulation s/'t “It is indeed unfortunate/' as another 1 Nouvel Abrege Chronologique de V Histoire de France , T. II. pp. 81-184. 2 Dupont, p. 86. — [ (Fumes de Tur¬ got, Tome I. p. 95. J * [(Euvres, Tome YI. pp. 120-291.] 3 Condorcet, p. 49. f [ (Euvres de Turgot , Tome I. p. 99.] 64 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. friend of Turgot, [Condorcet ?] remarks in mentioning the same incident, c< that in political discussions our judgments are less influenced by our reason than by the temper of our minds. Most understandings are able to perceive the truth, but few possess that force of character which is necessary for reducing it to practice. In such cases we naturally strive to disbelieve what we have no inclination to carry into effect ; and it is only the few who feel that courage which virtue inspires, who openly avow opinions which impose on them the duty of combating prejudices and intrigues, and of sacrificing the paltry politics of self-interest to general utility/' In 1774, a few months after the accession of Louis XVI., M. Turgot was appointed Controller-General of the Finances,1 in the room of Abbe Terray, and one of the first acts of his administration was to establish the freedom of the inland trade of corn through the whole kingdom. “ To animate agriculture by the prospect of a ready and free market for the commodities it supplies ; to increase at once the quantity of subsistence and the rents of lands ; to prepare for the people the resources of an active and extended commerce against unfavourable seasons and local scarcities ; to render their wages at all times equal to their wants by diminishing as much as possible the varia¬ tions in the price of grain ; — in one word, by the establishment of a certain and constant market, to secure the proprietors, the cultivators, the government, and the people at large, against all risk of losing any part of the produce of the land, as well as against the vexations, oppressions, and disorders which must occasionally arise from a system of restraints and prohibitions ; — such were the avowed motives of this wise and salutary law/'2 M. Turgot has himself explained and justified them at consi¬ derable length in the preamble of the Edict ,* which appears to have been drawn up with the view of obviating those objections which might present themselves against the expediency of the 1 He had before been appointed [(Euvres de Turgot, Tome I. p. 145.] Minister of the Marine, but Held the 2 Condorcet, p. 73. office only five weeks. Abrege Chron. * [See (Euvres , Tome VII. p. 10, Vol. II. p. 178. Dupont, p. 124. — seq.] CHAP. III. — OF TRADE. (§ 2.) 65 measure on a partial and superficial view of the subject. I would have introduced a translation of it here from a copy of his Edicts , which is in my own possession, if I had not been afraid of adding too much to the length of this digression. I must not, however, omit to mention, that although perfectly aware of the advantages to be expected from a free exporta¬ tion, as well as from a free inland trade, he had the caution and good sense to confine himself, in the first instance, to the establishment of the latter ; leaving the exportation of grain under the same prohibitions which had been enacted by the Abbe Terray. u His Majesty reserving to himself the satisfac¬ tion of bestowing marks of his special protection on such of his subjects as may import foreign grain into those parts of the kingdom where any symptoms of scarcity may appear ; and forbearing at present, to make any alterations on the laws which exist against exportation/'1 Unfortunately the harvest of this year turned out ill, and some apprehensions of a scarcity were felt or pretended in the spring following. It was difficult to suppose that this could have been the effect of an inland freedom of transportation ; nor did the enemies of the minister venture on such an assertion. They, however, took advantage of the agitation of the public mind, — declaimed upon the dangers of a free exportation, which then remained under the very same prohibition as before, and the ruin to be apprehended from speculative statesmen, willing to sacrifice the people to philosophical experiments. A sound and consequential logic is not very necessary in addressing the multitude upon subjects which interest their passions ; and it was easy to associate in their minds the measures of the actual administration with the public distress which was felt or appre¬ hended. A celebrated statesman and eloquent writer,2 who has since acted a conspicuous part on the theatre of Europe, has 1 “ Se reservant au surplus sa Majeste, jeste statuer quant a present et jusqu’a de donner des marques de sa protec- ce que les circonstances soient de venues tion speciale, a ceux de ses sujets qui plus favorables, sur la liberte de la vente auront fait venir des bles etrangers dans hors du Royaume.” — [CEuvres, Tome les lieux du Royaume ou le besoin s’en VII. p. 27.] seroit fait sentir ; n’intendant sa Ma- 2 Neclcer. VOL. IX. E G6 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. left a stain on his character, which will not be easily effaced, by the share which he had in promoting the public discontents against the salutary measures of Turgot and his friends. Misled, it is probable, by his own sanguine schemes of bene¬ ficence, he believed that he was serving his country by every step which facilitated his own advancement to power. Nor is it at all unlikely that he was really a dupe to his own ingenuity in his mistaken speculations on the legislation of grain. One thing is certain, that the argument in favour of the old pro¬ hibition system has been stated by no writer, either in France or in England, with equal force and plausibility. And we know, that at a later period of his life, when every object of his personal ambition was fully attained, he continued to act on the same narrow and erroneous principles. Another work which, about this period, (or rather a few years before,) excited much attention in F ranee, was the Dialogues on the Commerce of Grain, by the Abbe Galiani of Naples. The author was then living at Paris as secretary of legation to the Neapolitan embassy, and composed on this very unpromising subject, and in the French language, eight dialogues, which Voltaire (in a letter addressed to Diderot) pronounces to be worthy of the genius of Plato combined with that of Moliere. The principles he maintained were nearly the same with those which were afterwards adopted by Necker, and produced so great an impression on the public mind, that a formal refutation of them was undertaken by the Abbe Morellet. The Marquis Caraccioli, in a letter from Paris to Galiani, who had returned to Naples previous to the publication of his book, mentions the opinions of Turgot with respect to its merits. u Turgot/' says he, “ agrees perfectly with the Abbe Morellet in thinking, that no doctrines were ever calculated to do more mischief." The Government, however, at this period, inclined to the opinions of Galiani, and prohibited the Abbe Morellet to continue the controversy. I made some remarks, at our last meeting, on the Corn-trade, confining myself chiefly to the inland branch of it, but inter- CHAP. III. — OF TRADE. (§ 2.) 67 spersing a few observations, which seemed to arise naturally from the subject, on the prejudices against a free exportation. The prosecution of this argument led me to take notice of the extreme difficulty of this article of Political Economy, — a difficulty not arising from any peculiar obscurity in which the truth is involved, but from the necessity under which a states¬ man must frequently find himself of yielding something to the prejudices and passions of those whom he governs. The history of France during the last forty years affords some memorable examples of this ; and I refer to it in preference to that of our own country, both because the opposite opinions have been there carried to a greater extreme, and because I feel myself less under restraint in censuring the undue influence which these opinions have occasionally had on public measures. I mentioned the steps taken (under the administration of M. de Laverdi,) towards an emancipation of this branch of com¬ merce from the restraints which had so long fettered it. The king’s Edict, giving 11 permission to circulate corn and flour through the whole extent of the kingdom, free from all duties,” was dated at Versailles 25th May 1763. Another Edict, relative to the exportation and importation of grain, was given at Com- piegne in the month of July 1764. The preamble is not undeserving of attention. “ The attention which we owe to everything that may con¬ tribute to the welfare of our subjects, hath induced us to give a favourable hearing to the petitions which have been presented to us from all parts, to establish an entire liberty in the Corn Trade, and to revoke such laws and regulations as have been heretofore made to restrain it within too strict bounds. After having taken the opinion of persons the best acquainted in the affair, we thought it necessary to comply with the solicitations which have been made to us for the free exportation and im¬ portation of com and meal, as proper to encourage and in¬ crease the cultivation of land ; to maintain plenty by magazines and the importation of foreign corn ; to prevent corn from being at a price which discourages the grower ; to banish monopoly by an irrevocable exclusion of all particular permis- 68 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. sions ; and in the end, by a free and entire competition in the trade, to keep up between different nations that communica¬ tion of exchanging superfluities for necessaries, so conformable to the order established by Divine Providence, and to views of humanity, which ought to animate all sovereigns.” The speech of M. de Carodeuc de la Chalotais, when he pre¬ sented this Edict for registration to the Parliament of Brittany, may be found in the Supplement to the [C. Smith's] Three Corn Tracts , [1766.]* It is valuable as it exhibits a view of the state of the corn- trade in France for more than a century preceding. The revocation of these Edicts under the administration of the Abbe Terray, and the subsequent measures of Turgot, were stated in my last lecture with sufficient minuteness for my present purpose. Of the origin and progress of this literary and political con¬ troversy in France, a circumstantial account may be found in various writers. The following rapid sketch is a faint transla¬ tion from the light and inimitable pen of Voltaire. I quote it less on account of the information it conveys, than of the happy touches with which the author characterizes the enthusiasm and levity of his frivolous countrymen. “ About the year 1750, the French nation surfeited with verses, with tragedies, with comedies, with operas, with ro¬ mances, with romantic histories, with moral reflections more romantic still, and with disputes on the mysteries of theology, betook itself to discussions on the subject of grain. The vine¬ yards were forgotten, and nothing was talked of but wheat and rye. Volumes on volumes were written about agriculture, which everybody read excepting the husbandman. It hap¬ pened to strike some one in his way home from the Opera Comique , that France had immense quantities of grain to dis¬ pose of ; the nation became clamorous, and obtained from the Government, in 1764, the freedom of exportation. The conse¬ quence was the same as in the reign of Henry IV. The * [I have not been successful in find- The edition which I have examined is ing the speech in the place designated. dated London , 1766.] CHAP. III. — OF TRADE. (§ 2.) GO exportation was carried a little too far, and a year of scarcity followed. The discontented ran from one extreme to the other, and declaimed against the exportation which they had solicited. Some men of genius and of the most disinterested benevolence wrote with equal sagacity and courage in favour of an unlimited freedom in this branch of commerce. Others not inferior in genius, and with motives not less pure, contended that this ireedom should he subjected to regulations. Of this number was the Abbe Galiani of Naples, who discovered the secret of composing (and in the French language) dialogues as amusing as our best romances, and as instructive as our most serious performances. If this work did not lower the price of bread, it gratified the public in a way not less acceptable, by adding to the stock of its entertainment. The advocates for an un¬ limited exportation replied formally. The result was, that their readers knew no longer what to make of the controversy : The greater part began a course of novel reading, in hopes that three or four years of plenty might enable them to form a judgment. The ladies relapsed into their former ignorance of the distinction between rye and wheat ; and the curates re¬ turned to their old belief, that the seed must die and rot before it quickens.”* The same prejudices with respect to the corn-trade, which were employed so unjustly but so successfully as an engine ol popular opposition to the administration of Turgot, appear to have existed in full force in many parts of France at the period when the late Bevolution commenced. Of this a judgment may be formed from the Colliers , or papers of instructions given by the different electoral bodies to their representatives. By one of these (the Tiers-etat de Meudon) it is demanded, that as France is exposed to the rigours of fanjine, every farmer shall be obliged to register his crop ol every kind, and also every month the quantity sold.” Another requires, u That the severest laws be passed against monopolizers, whose agency at present desolates the kingdom.” Fifteen demand the * [The original will be found in the Dictiounciive Philosophique , Ait. I>lt, Heel, iii.] 70 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. erection of public magazines ; and even the author ot the Caliier presented by the Tiers-etat de Paris , demand u that the transport of corn from province to province should be pro- hibited.”1 Nor will the inveteracy of these prejudices in France appear so wonderful, when we consider that in that country the people live almost entirely on bread ; that in consequence ol the small farms which are everywhere prevalent, the quantity of corn in the markets is always, in Autumn, beyond the pro¬ portion reserved for supplying the rest of the year ; and that the number of real speculators or accapareurs , is by far too inconsiderable to remedy this evil. From these causes the sup¬ ply must necessarily be irregular and frequently insufficient ; an insufficiency, however, wonderfully increased by that popu¬ lar violence which has been so often encouraged and sanctioned by blunders of Government and by arrets of Parliament. Of this prejudice, deeply rooted in the minds of the French population, a very dexterous and but too successful advantage was taken by those anarchists who availed themselves of the revolutionary crisis as a fit occasion for wresting the govern¬ ment from the hands of their lawful masters : and it was by means of that violence so naturally inspired by such prejudices, that the lower orders were first stimulated to those sanguinary atrocities which have left so indelible a stain on the national character. A more striking example is not furnished in the whole range of history, of the expediency of correcting, in times of established tranquillity, whatever errors and misappre¬ hensions on the part of the people seem most likely to furnish arms to ambitious and unprincipled demagogues, with which they may, in times of distraction and disorder, assail the autho¬ rity of wisdom and virtue. They demonstrate the truth of the maxim of a French writer, speaking of religious enthusiasm — a maxim which may be extended with equal justice to all the duties of a government : — u Seize the moment when the tide is at the lowest ebb to repair and strengthen your dikes/' With these views it may be proper to prosecute a little farther this account of the fluctuations of the French policy, in 1 Young’s France , p. 482. CHAP. III. — OF TRADE. (§2.) 71 regard to the commerce of grain. In doing so, I shall be un¬ avoidably led to anticipate some observations connected with another branch of our subject. But this apparent defect in arrangement, is the necessary consequence of the connexion which subsists between the different branches of the corn- trade. In the months of May and June 1789, after a harvest, which though not great, is allowed to have been but little under the common average, so extraordinary a dearness pre¬ vailed, that M. Keeker thought it expedient to order immense cargoes of wheat, and every other sort of corn, to be bought up all over Europe. In a paper published by himself, entitled Memoire Instructif ’ he states, that he has ordered to be bought 1,404,463 quintals of different sorts of grain, of which more than 800,000 were arrived. The expense of this importation amounted to 45,543,697 livres, (about £2,000,000 ;) and to such a length were plans of economy carried among the higher orders, that we are assured the king allowed only bread of wheat and rye mixed to be served at his own table. It does not belong to our present subject to offer any opinion concerning the primary causes of this pretended scarcity. That it originated with the minister I am very far from supposing or believing, but that he contributed, by his indiscretion, greatly to aggravate the evil, while he was disinterestedly risking his own fortune in an attempt to counteract it, appears to be unquestionable. The following sentence in his Memoire In¬ structif admits of no apology, and is perfectly in the style of the addresses made, of late, by the English judges to the grand juries. u Monopolizing is the first cause to which the multitude naturally ascribes the high price of grain ; and, in fact, there is often but too much reason to complain of the mischiefs occasioned in this way by the avarice of mercantile speculators.’’1 The consequences were such as might have been expected, - 1 “ Les accapareinens sont la premiere souvent eu lieu de se plaindre cle la eause a laquelle la multitude attrilme cupiditc des speculateurs.” la elierte des grains, ct en effet on a 72 POLITICAL ECONOMY.— PART I.— ROOK II. — NAT. WEALTH. a blind rage against Monopolizers, accompanied with various outrages and atrocities. In June and July the markets were not opened till troops arrived to protect the farmers from having their corn seized ; and the magistrates, to prevent insurrections among the people, had recourse to the pernicious measure of regulating prices. The farmers, in consequence, refrained from p-oinsr to market, in order to sell their wheat at home at the O O / best price they could get, (which was, of course, much higher than the assize of the markets ;) and an evil which, if left to itself, must, at the worst, have terminated in the inconveniences connected with a short or deficient crop, began to assume the awful appearance of an inevitable famine. In the proceedings of Government on this occasion, nothing seems to have been more reprehensible than an imprudent disclosure of its own apprehensions and alarms. We are told by Mr. Arthur Young, who was engaged in an agricultural survey of France at this period, that the publication of M. Necker’s Memoire Instructif \ (in which he announced the steps he had taken for the importation of a suitable supply,) “ instead of sinking the price, raised it directly and enormously : upon one market day at Nangis, from thirty-eight livres to forty-three livres the septier of two hundred and forty pounds, and upon the following one (July 1st) to forty-nine livres. On the next day, at Columiers, it was taxed by the police at four livres five sous, and four livres six sous the twenty-five pounds ; but as the farmers would not bring it to market at that price, they sold it at their farms at five and a half livres and even six livres ; that is, at the rate of fifty-seven livres the septier. At Nangis it advanced, in fourteen days, eleven livres a septier ; and at Columiers a great deal more."* Of these facts Mr. Young was an eye-witness; and as they took place in the vicinity of the capital, for which the great foreign provision was chiefly destined, they prove, in the most unequivocal manner, the mischiefs produced by the agitation thus excited in the public mind. A measure which cost the nation forty millions of livres, had the effect, in the two markets which Mr. Young * [Travels in France , p. 477.] CHAP. III. — OP TRADE. (§ 2.) ' 73 attended, of instantly raising the price of grain twenty-five per cent, — -a rise depending solely on opinion, as both the quantity of corn and of money in the kingdom remained the same as before. If no public step whatever had been taken, Mr. Young gives it as his opinion, that the price of wheat, in no part of France, would have been, in 1789, at so high a rate as thirty livres, instead of rising to fifty and fifty-seven livres. From these circumstances, Mr. Young has drawn a conclu¬ sion which deserves the serious attention of all Governments, — - “ Never to express publicly any apprehension of a want of corn, by proclamations against exports, by regulations of sale, by laws against monopolizers, or by holding out hopes of importation.”* All these measures have the same tendency. They confirm amongst the people the apprehension of want and of famine : and this can never take place without, in some degree, realizing the evil apprehended. It is, therefore, the duty of a wise and enlightened government, if at any time they should fear a short provision of corn, to take the most private and cautious measures possible either to prevent export, or to encourage imports, and to avoid making any public decree or declaration. Of the truth of this M. Necker appears to have been aware, when he pub¬ lished his Treatise on the Legislation and Commerce of Grain. “ Un des plus grands inconveniens attaches aux permis d ’im¬ portation ; c’est quelle instruit avec eclat de finquietude du governement, qu’elle accroit ainsi les alarmes et rencherit le prix.”1 From the occurrences which took place in our own country a few years ago, there is ground for suspecting that the truth of this maxim is, here, far from being universally admitted among our legislators. The result, too, was perfectly analogous to what was observed in France. But on this topic I forbear to enlarge at present. As it is only the inland trade of corn which falls immediately under our consideration in this part of our argument, it would be foreign to the subject to examine particularly the wisdom of M. Necker’s system in prohibiting the export of grain, (which the Archbishop of Sens had permitted the year before,) or in * [Ibid. p. 476.] 1 P. 293. 74 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. attempting to relieve tlie apprehended scarcity by importing to so large an amount as has already been mentioned, [supra, p. 71.] I cannot help, however, taking this opportunity of remarking, as an illustration of what was formerly stated concerning the insignificancy of th e foreign trade of corn when compared with the inland , that the supply obtained by M. Necker at the expense of two millions sterling, would not (according to Mr. Young's calculation) add three days' provision to the national stock.1 So completely ineffectual is importation on the largest scale as a remedy for famine, and so absurd is the idea of providing for the wants of a numerous community by means of a resource which must necessarily bear so trifling a proportion to their consumption. Mr. Young ventures to push the conclusion, and to assert, that all great variations in the price of corn are engendered by apprehension, and do not depend on the quantity in the market. That this was the case in France in 1789, appears clearly from the facts already stated ; but although I am very far from presuming to deny the truth of the general proposition, I am not quite prepared to admit it in its full extent without some farther illustration. One great source, according to this author, of the common mistakes on this head, is the extravagant cal¬ culations that have been offered to the public concerning the annual produce of different countries. The Abbe Rosier, for example, declares, “ que la France recolte, annee ordinaire, pres du double plus de bled qu'elle n’en consume." “ If this be true," Mr. Young asks, “ what becomes of the surplus ? Where are the other 26,000,000 of people who are fed with French corn? Where do the 78,000,000 of septiers go that France has to spare, a quantity that would load all the ships possessed by that kingdom, above thirty times, to carry it ? Instead of the common crop equalling two years’ consumption, it certainly does not equal thirteen months’ common consumption ; that is, sncli a consumption as takes place at an average price. And all the difference of crops is, that consumption is moderate with a bad harvest, and plentiful with a good one. The failure of a 1 Young’s France, p. 179. CHAP. III. — OF TRADE. (§ 2.) 75 crop in one province, in a very small degree, which, under a good government and entire liberty of trade, would not even be felt, will, under a system of restrictions and prohibitions, raise the price through the whole kingdom enormously ; and if measures are taken by government to correct it, they will convert the high price into a famine/'* Thus far Mr. Young, to whose opinion on the subject I am disposed to pay the greater deference, that it coincides with that of Sir James Steuart, an author of very extensive and accurate research on all questions connected with Political Arithmetic , and whose information, in point of facts, will he allowed even by those who think the most lightly of his speculations , to rest in general on very authentic documents. I shall transcribe the passage, (with a few retrenchments,) though at the hazard of repeating some ideas, which may occur else¬ where, in a different form, in the course of the discussion. “ I have often said that numbers are in proportion to the produce of the earth. I now say, that, in most countries of Europe, the food produced in the country is nearly consumed by the inhabitants ; or, in other words, that the part exported bears a small proportion to the home consumption. I do by no means establish this as a universal proposition, but I say it is true, for the most part, and under certain limitations. I allow, for example, that Holland, not producing food for its inhabi¬ tants, must draw it from some country which produces a super¬ fluity regularly. But let it be observed that Poland, Germany, Flanders, and England, with many other countries, contribute their contingents to supply the demand of the Dutch, as well as of several large trading towns which have small territories. This being the case, the quota furnished by each country must be in a small proportion to the respective quantity growing in it. . . . “ In farther confirmation of this conclusion, let us attend to the state of the fact in England, — one of the countries in Europe abounding, undoubtedly, as much as most others in grain. Nothing is more common than to hear that an abun¬ dant crop furnishes more than three years’ subsistence. Nay, it * [ Travels in France , p. 485, note.] 76 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. is advanced by an author of note, (. Advantages and Disadvantages of France and Great Britain , die., Art. Grain,) that a plentiful year produces five years’ nourishment for the inhabitants. . . . I am, on the contrary, apt to believe, that no annual produce of grain ever was so great in England as to supply the inhabitants fifteen months, in that abundance with which they feed them¬ selves in a year of plenty. If this be the case, at what may we compute the surplus in ordinary good years ? I believe it will be thought a very good year which produces full subsistence for fifteen months ; and crops which much exceed this are, I believe, very rare. My reasons for thinking so are as follows : — “ I consider all the yearly crop of grain in England as con¬ sumed at home, except what is exported ; for I cannot admit that any considerable quantity is lost : — that it may be abused, misapplied, drunk when it should be eat, I do not deny. These are questions which do not regard the present inquiry. Whether, therefore, it be consumed in bread, beer, spirits, or by animals, I reckon it consumed ; and, in a year when the greatest con¬ sumption is made at home, this I call the abundance with which the inhabitants feed themselves in years of plenty. Now, I find, in the performance above cited, a state of expor¬ tations for five years, from 1746 to 1750 inclusive where the quantity exported amounts in all to 5,289,847 quarters of all sorts of grain. This is not one year’s provision, according to Sir William Petty, who, supposing the inhabitants of England to be 6,000,000, estimates the yearly consumption of grain of all kinds at about 6,000,000 of quarters.* The bounties on Corn (continues the same author) have amounted in one year to £500,000. Supposing this statement to be true, and that the whole exportation was made out of the produce of one crop, this sum does not answer to the bounty upon 3,000,000 of quarters, which, according to Sir William Petty, make six months’ provi¬ sion. I calculate thus : — The bounty upon wheat is five shillings a quarter, that upon rye three shillings and sixpence, that upon barley two shillings and sixpence, these are the species of grain * [This calculation Sir James Steuart Book I. chap. viii. ; Works, Vol. I. p. takes from a previous part of his work, 53, seq.] CHAP. III. — OF TRADE. (§ 2.) 77 commonly exported ; cast the three premiums together, and divide by three, the bounty will come to three shillings and eight- pence at a medium, at which rate £500,000 will pay the bounty of 2,727,272 quarters of grain. An immense quantity to be exported ! but a very inconsiderable part of a crop, supposed capable to maintain England for five years/' . . . ci On the other hand," continues the same author, u I am apt to believe that there never was a year of such scarcity as that the lands of England did not produce greatly above six months' subsistence, such as the joeople are used to take in years of scarcity. Were six months of the most slender subsistence to fail, I imagine all Europe together might perhaps be at a loss to supply a quantity sufficient to prevent the greatest desola¬ tion of famine."* In proof of this, Sir James appeals to a fact which (not having access at the time to the registers of the trade in grain) he states on the authority of a London newspaper. From this document it appears, that from the 9th of April to the 13th of August 1757, while great scarcity was felt in England, there were declared to be in the port of London no more than 71,728 quarters of wheat, of which 15,529 were not then arrived ; so that the whole quantity there imported to relieve the scarcity was 56,199 quarters. Not one month’s provision for the inhabitants of that city, reckoning them at 800,000 souls. Another fact, leading to the same conclusion, Sir James states from his own observation on what he saw in Germany during the year 1757, where, in the numerous armies which were then assembled, there was a universal complaint of scarcity. “ When we compare," says he, “ the numbers of an army, let it be of 100,000 men, with a suit no less numerous, and 40,000 horses, what an inconsiderable number does this appear in proportion to the inhabitants of so vast a country as Germany ! Yet let us observe the quantity of provisions of all sorts constantly coming down the Rhine, the Moselle, and many other rivers, collected from foreign provinces on all hands ; the numbers of cattle coming from * [ Political ( Economy , Book I. cliap. xvii. ; Works , Vol. T. pp. 143-146. J 78 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. Hungary ; the loads of corn from Poland ; and all this in a year which has produced what at any other time would have been called an excellent crop. After these foreign supplies, must not one he surprised to find scarcity complained of in the provinces where the war is carried on, and high prices everywhere else ? From such circumstances I must conclude, that people are generally very much deceived in their estimate of plenty and of scarcity, when they talk of two or three years subsistence for a country being found upon their lands at once. I may indeed be mistaken in my conclusions, but the more I have reflected on this subject, the more I find myself confirmed in them, even from the familiar examples of the sudden rise of markets from very inconsiderable monopolies , and of the sudden fall by inconsiderable quantities imported.”* After these remarks, Sir James Steuart proceeds to resolve a difficulty which naturally arises out of the foregoing doctrine, and which seems at first view to suggest a strong objection against some of his conclusions. u If it be true,” says he, “ that a crop in the most plentiful year is nearly consumed by the inhabitants, what becomes of them in years of scarcity ? for nobody can deny that there is a great difference betwixt one crop and another. To this I answer, first, That I believe there is also a very great deceit, or common mistake, as to the difference between crops : a good year for one soil, is a bad one for another. But I shall not enlarge on this, because I have no sufficient proof of my opinion. The principal reason upon which I found it is, that it is far from being true, that the same number of people con¬ sume always the same quantity of food. In years of plenty, every one is well fed ; the price of the lowest industry can pro¬ cure subsistence sufficient to bear a division ; food is not so frugally managed ; a quantity of animals are fatted for use ; all sorts of cattle are kept in good heart ; a people drink more largely because all is cheap. A year of scarcity comes, the people are ill-fed, and when the lower classes come to divide with their children, the portions are brought to be very small ; * [Il>id. pp. 148, 149.] CHAP. ITT. — OF TRADE. (§ 2.) 79 there is great economy upon consumption, few animals are fatted for use, cattle look miserably, and a poor man cannot indulge himself with a cup of generous ale. Added to all these circumstances, that in England the produce of pasture is very considerable, and it commonly happens, that a bad year for grain, which proceeds from rains, is for the same reason a good year for pasture ; and in the estimation of a crop every circumstance must be allowed to enter.”* It may be worth while to take this opportunity of remark¬ ing, that in this country we have a resource against scarcity, not to be found in vine countries, that of stopping the distil¬ leries. The expedient of stopping the manufacture of starch has also been occasionally had recourse to. The foregoing quotations seem abundantly to confirm the truth of the general positions which they were brought to sup¬ port, that in most countries of Europe the food produced in the country is nearly consumed by the inhabitants, (or in other words, that the part exported bears a small proportion to the home consumption,) and consequently, that all great variations in the price of corn are engendered by apprehension, and do not depend on the quantity in the market. Various other proofs of the same thing may be found in Vaughan's Treatise on Commerce. Even M. Necker himself admits, that during half a century the importation into France has never borne to the whole consumption a higher proportion than that of one or two to a hundred;1 nor does he seem much disposed to call in question the accuracy of those who affirm, that during the three years which followed after the Edict 1764, establishing a liberty of exportation under certain limitations, the ex¬ portation never exceeded the hundredth part of the annual consumption.2 These truths cannot be too frequently or too strongly incul¬ cated on the minds of the people ; and in so far as Necker's measures in 1789 had a tendency to encourage contrary ideas, * [Ibid. pp. 149, 150.] Vaughan, foi’ I have not been able to find the passage in Needier. 1 I state this on the authority of 2 Sur La Legislation des Graivs, p. 58. 80 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. they justly merit the censures they have received. The passage, in particular, formerly quoted [supra, p. 71] with respect to monopolizers, at a period when the force of Government was so incompetent for the protection of persons and properties, leaves a blemish on his character both as a man and a minister, which it will not be easy for his most partial admirers to remove. The facts, too, stated by Mr. Young, seem sufficiently to prove, that by several indiscretions both in his measures and in his writings, he contributed to aggravate instead of lessening the evil. Notwithstanding, however, these concessions to M. decker's opponents, and my own conviction of the erroneousness of his general principles concerning the legislation of grain, I cannot without forfeiting all claim to candour, join with Mr. Young in an unqualified censure of the measures which he opposed to the scarcity, real or pretended, of 1789. The ordinary powers of Government, which, during the administration of Necker’s immediate predecessor, had completely lost their energy and almost their existence, were then supplied entirely by the com¬ manding influence of public opinion, and by the enthusiastic confidence with which the great body of the nation looked up to the virtues of the Sovereign, seconded by an almost universal conviction of the patriotism and the talents of his minister. In such circumstances, it would be unfair to judge of the mea¬ sures which were adopted, by the same maxims which apply to a nation in times of tranquillity, among whom the wise and equitable arrangements of an enlightened legislator can be established at once by the irresistible arm of the executive magistrate. That the freedom of the corn- trade, although a wise and just measure considered abstractly, was rashly established in the year 1787, by the Archbishop of Sens, will, I believe, be readily granted by all who are well acquainted with the circumstances of fine case. It was certainly not a time to shock popular pre¬ judices upon a subject of so delicate and critical a nature ; and of all men, M. de Brienne , who had been intimately connected with M. Turgot, ought to have avoided a step which could not CHAP. III. — OF TRADE. (§ 2.) 81 fail to revive the old clamours that had been excited (however unjustly) against a far less violent reform, when hazarded by that minister. Nor does it afford any apology for this measure to observe with Mr. Young, that the trade which this freedom encouraged was more an import trade than an export one. The contrary was much more likely to be believed by the people, and although (as we shall afterwards shew) a freedom of exportation is no less beneficial to the community than a freedom of importation, the truth of this principle is far from being obvious to common understandings, and it requires a course of years to verify it by actual experience. Its first effects, so far as they extend, are certainly to diminish the sub¬ sistence of the people, and to enhance its price ; and it was in a high degree impolitic at a moment when the whole fabric of the French Government was tottering to its fall, to risk this alarming inconvenience, although of a temporary nature, upon the speculative hope of a distant advantage, which nothing but the continuance of national tranquillity could realize. I apprehend, therefore, that M. Necker was fully justified in pro¬ hibiting the trade of exportation, from the regard which a wise minister must frequently feel it his duty to pay to popular pre¬ judices, more especially as, in this instance, he did no positive harm, but merely abandoned a speculative principle. Nor am I even disposed to condemn, without many qualifications of the censure, the efforts which he made for the importation of grain. They tended, at least, to satisfy the people, that the scarcity which existed was not owing to the intrigues of Government, and thereby to support that popularity of the Sovereign, which then constituted the whole strength of the monarchy ; and which, if the charm had not been broken by the fatal measure of Necker’s exile, would in all probability have continued to oppose an effectual barrier to the rage of violent innovation. It must be remembered, too, that however trifling the supply may appear when compared with the whole population of France, the case is very different when compared with that of Paris and the neighbourhood, where it was of the greatest con¬ sequence to allay the popular alarms. Even here, if the supply VOL. IX. F 82 POLITICAL ECONOMY.-— PART I. — BOOK II. — NAT. WEALTH. had been small in fact, it affords a sufficient justification of the minister, if his measure contributed to revive the public confi¬ dence. — I believe, indeed, that it actually failed in this respect, but it was not unnatural to expect the contrary ; and at any rate, circumstanced as things then were, it was the only measure left for the Government to employ. A remark which Mr. Young himself has made, ought always to be kept in view in judging of the measures which were adopted on this occasion. “ The mass of the people in great cities are all alike, absolutely ignorant of how they are fed, and whether the bread they eat be gathered like acorns from a tree, or rained from the clouds ; they are well convinced that God Almighty sends the bread, and that they have the best possible right to eat it.” * Mr. Smith, too, with all his strong attachment to an un¬ bounded freedom in this branch of commerce, candidly insinuates an apology for the absurd regulations which restrain the corn- trade under almost all governments. “ The laws concerning corn,” he observes, a may everywhere be compared to the laws concerning religion. The people feel themselves so much interested in what relates either to their subsistence in this life, or to their happiness in a life to come, that government must yield to their prejudices, and, in order to preserve the public tranquillity, establish that system which they approve of. It is, perhaps, on this account,” he adds, ce that we so sel¬ dom find a reasonable system established with regard to either of those two capital objects. ”f The very same comparison between the laws respecting corn, and those which relate to religion, occurs in M. Keekers Treatise on the Legislation and Commerce of Grain . In speaking of the free exportation of this article, he observes, that “ although it were as favourable to the public prosperity, as he believes it adverse to it, it would be scarcely possible to maintain the authority of the law which should establish, in opposition to the prejudices and passions of the people.” “ The * [Travels in France , p. 484, seq.] t [ Wealth of Nations , Book IV. chap. v. ; Vol. II. p. 318, tenth edition.] CHAP. III. — OF TRADE. (§ 2.) 83 bread/' says he, “ by which the people are fed, the religion by which they are comforted, are ideas as simple as human nature, and inseparable from the human frame. The prosperity of the state, the interests of ages yet to come, the interests even of the succeeding generation, are words which produce no impression. The people feel themselves related to society by their sufferings alone, and of all that immense space which is called the future , the pressure of their wants prevents them from extending their views beyond a provision for to-morrow. cc It is thus/' he concludes, “ that when the price of corn rises so high as to make their subsistence uncertain, a cry is naturally and necessarily raised against exportation, and against every law on which a pretence of blame can be thrown for the hardships and anxieties they suffer. In the midst of their daily toils, and of their ordinary indigence, they survey with tran¬ quillity the indolence, the affluence, and the apparent happiness of the rich ; they are accustomed to consider them as beings of a different species, and to be dazzled by the magical splendour of pomp and magnificence. But when an alarm, whether well or ill-founded, concerning the means of subsistence, lays hold of the imagination, and touches the great spring of all their move¬ ments, the whole of their energy rouses, and the same people who suffer themselves, with an infantine simplicity, to be easily guided by leading strings through all the spectacles which society presents of an inequality of prosperity, and through all the contrasts they see of want, on the one hand, and superfluity on the other, exhibit the ungovernable ferocity of a beast of prey when urged by the terror of famine." It is not, however, I presume, on these general considerations that M. Necker or his friends would wish to rest his vindication for the great importation he attempted in 1789. Nor do I suppose they would admit the conclusiveness of Mr. Young's reasonings against it, founded on the inconsiderable proportion between the quantity imported and the whole population of France. I already said, that it is only with the population of Paris and the neighbourhood that it ought to be compared, as it was in this part of France that it was chiefly intended to 84 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. operate. But abstracting entirely from this circumstance, Mr. Young seems to have overlooked completely one very important principle in this argument — that a very trifling difference in the quantity of grain in the market may occasion an immense fall or rise in the price. This observation was long ago made by Mr. King, in a passage quoted by Dr. Davenant, and has been more fully illustrated by the author [Mr. Charles Smith] of the Three Tracts on the Corn-Trade * which I have already repeatedly referred to. M. Keeker, too, in combating an asser¬ tion of a writer on the Commerce of Grain, that the price of that commodity varied proportionally with the quantity in the market, u so that to raise it a fifth or a tenth, a fifth or a tenth must be abstracted from the general supply/' asserts that the abstraction of a fifth or a tenth, or of much less, may, in certain circumstances, raise the price beyond all bounds. In particular, he asserts that the exportations after the year 1764, (which we are assured by the partisans of that measure never exceeded the hundredth part of the whole consumption,) raised, in several of the provinces of F ranee, the price nearly a hundred per cent. “ It is not/' he adds, “ with the amount of grain left in the country that we must compare the quantity abstracted by exportation, but with the amount of that surplus, which ex¬ perience shews to be necessary for keeping within bounds the speculations of monopolizers, and the alarms of the consumers." Although, therefore, the quantity imported in 1789 had been much less than it was, it might still have produced a great reduction in the price, and would probably have done so if the public mind had not been agitated by a thousand other causes of a very different nature. The truth is, that the question concerning the expediency of this measure cannot be decided on any general principles of Political Economy, but turns entirely on the adaptation of the measure to the actual state of the public mind. On this point, whatever the result was, I have no doubt in preferring the judgment of the Minister to that of Mr. Young. Still, however, we remain under very great obligations to this * [P. 47, seq. et alibi.] CHAP. III. - OF TRADE. (§ 2.) 85 last writer for the stress he has laid on that very important fact which gave rise to this discussion, — That the import and export trade of corn are extremely insignificant in the case of a great country like France or England, when compared with that which is carried on at home. But although this demon¬ strates, that it is on the freedom of the inland trade that the subsistence of the people essentially depends, and that if the people were entirely under the government of reason, the export and import trades would be objects of very little consequence to the Legislator, it does not follow that they may be safely neglected by a statesman placed at the head of an unen¬ lightened, prejudiced, and turbulent nation, over which he possesses little power but what is founded on public opinion. On the contrary, it appears from the fact, that an export or an import trade, however trifling the effects which they might be expected a priori to produce, may not only, in particular cases, materially affect the general tranquillity, but may actually pro¬ duce a very great variation of price , by influencing the imagi¬ nations and passions of the multitude. In this point of view, they are objects of attention to the Legislator, no less than those causes of plenty and scarcity which may be subjected to the rigour of arithmetical computation ; and in so far as this is the case, it will not be disputed, that the dexterous management of them requires a much nicer and more practised hand. u It is a common and fatal error among systematical politi¬ cians (as Mr. Smith has well remarked in the last edition of his Theory of Moral Sentiments ) to imagine, that they can arrange the different members of a great society with as much ease as the hand arranges the different pieces upon a chess-board. They do not consider that the pieces upon the chess-board have no other principle of motion than that which the hand impresses upon them, but that in the great chess-board of human society every single piece has a principle of motion of its own altogether dif¬ ferent from that which the Legislature might choose to impress upon it. If those two principles coincide and act in the same direction, the game of human society will go on easily and har¬ moniously, and is very likely to be happy and successful. It 86 POLITICAL ECONOMY. — PART 1. — BOOK II. — NAT. WEALTH. they are opposite or different, the game will go on miserably, and the society must be at all times in the highest degree of dis¬ order. Some general and even systematical idea of the perfection of policy and law (the same author continues) “ may, no doubt, be necessary for directing the views of the statesman. But to insist upon establishing, and upon establishing all at once, and in spite of all opposition, everything which that idea may seem to require, must often be the highest degree of arro¬ gance.”* These observations, while they serve to illustrate a distinc¬ tion to which I have frequently referred, between what is abstractly right and practically expedient , will, if I am not mistaken, go a certain length in vindicating M. Eecker s mea¬ sures ; or, at least, to show, that where they were erroneous, the error did not arise from their want of conformity to the general principles of Political Economy, but from their being carried into execution in a way which tended rather to aug¬ ment than to allay the ferment in the public mind. On this subject, both he and his opponents seem to me to have gone into extremes ; the one too much engrossed with the details of a particular administration to rise to the contemplation of general principles; the other blinded by their admiration of what is theoretically true to the obstacles which present them¬ selves in the actual conduct of affairs. In a paper published a good many years ago,f I have said of M. Eecker’s Eloge on the Administration of Colbert , u that although confined and erroneous in its general principles, it contains many important and just remarks of a practical nature.” After all that I have read and heard of this cele¬ brated man, I am still disposed to retain the same favourable sentiments of his character and of his talents, and even where I differ the most widely from his systematical views, not only to acknowledge the purity of his intentions, but to admire the extensive influence which his genius and virtues so long gave * [Part VI. chap. ii. sect. 2, sixth of Adam Smith, J 793, sect. iv. ; infra, and later editions.] y0l, X. p. 64.] + [Account of the Life and Writings CHAP. III. — OF TRADE. (§ 2.) 87 him over the destiny of Europe. “ Of his merits and measures as a statesman,” says Mr. Gibbon in his Memoirs , “ various opinions may be entertained ; but all impartial men must agree in their esteem of his integrity and patriotism.” At a later period, the same writer has said, in speaking of a visit which he paid to M. Necker in 1792, after his fall from power : “ Of Necker I have really a much higher idea than I ever had before. In our domestic intimacy he cast away his gloom and reserve ; I saw a great deal of his mind, and all that I saw was fair and worthy. He was overwhelmed by the hur¬ ricane ; he mistook his way in the fog ; but in such a perilous situation, I much doubt if any mortal could have seen or stood.” I have only to remark farther at present, that those who advised the measure of sending Necker into exile immediately after the opening of the National Assembly, have themselves to blame for those misfortunes which afterwards overwhelmed themselves and their country. Till that period nothing could exceed the popularity of the king ; and this popularity was the most powerful engine which Necker had to employ for the government of the nation. It became henceforth manifest, that the king was either not sincerely disposed to carry into effect those plans of reform which he had led the people to expect' ; or that his good intentions were frustrated by some secret influence over his counsels. A breach took place between the Government and the people ; a violent insurrection demo¬ lished the Bastile ; the military caught the general enthusiasm ; and when M. Necker, after an absence of three weeks, was pre¬ vailed on by the solicitation of the king to resume the reins of Government, he found the people completely instructed in the fatal secret of their own strength, and under the direction of demagogues too turbulent and ambitious to submit to the con¬ trol of any higher authority. If he had consulted merely his own tranquillity and reputation, he would have refused to obey the summons which was thus extorted by necessity from the authors of his recent disgrace ; and would have put it out of the power of malignant and unprincipled men to involve him 88 POLITICAL ECONOMY. — PARTI. — BOOK II. — NAT. WEALTH. in any responsibility for events which from this moment no human wisdom could avert. I shall make no apology for this short digression, which, I hope, is not altogether foreign to my subject, and from which I now return to the general argument concerning the legislation of grain. In what I have hitherto said on the Inland Trade of Corn, I have considered chiefly in what manner an unlimited freedom operates as a palliative of the inconveniences of a dearth. I now proceed to observe that the same freedom is the best pre¬ ventive of that calamity, by the encouragement it gives to an intermediate order of men between the grower and consumer, who contribute powerfully to the prosperity of the farmer, and to the increase of the annual produce. I before said, that the ancient policy of Europe encouraged the popular odium against this beneficial trade, regulating thereby the Agricultural Commerce of the country by maxims essentially different from those which it established with regard to the Manufacturing Commerce of the towns. The Farmer was obliged to become a Corn Merchant, while the Manufac¬ turer was, in many cases , forbidden to sell his goods by retail. The object of the one law was to make corn cheap ; that of the other to encourage the business of shopkeepers. In both cases the means employed had an obvious tendency to restrain indi¬ viduals in the employment of their capitals, while at the same time these means were altogether inadequate to the ends pro¬ posed. The manufacturer, though he had been allowed to keep a shop, and to sell his own goods by retail, could not have undersold the shopkeeper, for the capital placed in his shop must have been withdrawn from his manufacture, he must have had the profits of a manufacturer on one part of his capital, and those of a shopkeeper on the other. Though he might appear, therefore, to make a double profit on the same piece of goods, yet as these goods made successively a part of two distinct capitals, he made but a single profit upon the whole capital to which they furnished employment. For the CHAP. III. — OF TRADE. (§ 2.) 89 same reason the farmer could not afford to sell his corn cheaper than any other Corn Merchant would have been obliged to do in the case of a free competition. The dealer who employs his whole stock in one branch of business, has an advantage similar to the workman whose labour is employed in a single operation. This division in the employment of stock was forced on faster than it would na¬ turally have taken place by the law which prohibited the manufacturer from exercising the trade of a shopkeeper. The law which obliged the farmer to exercise the trade of a corn merchant, endeavoured to hinder it from going so fast. Both were unjust, but the latter was the most pernicious. It forced the farmer to divide his capital into two parts, of which one only could be employed in the cultivation of land, and conse¬ quently must have tended to obstruct improvement, and to raise the price of corn. After the business of the farmer, that of the corn merchant, if properly protected, would contribute the most to the raising of corn. It would support the trade of the farmer in the same manner as the trade of the wholesale dealer supports that of the manufacturer. It would enable the farmers to keep their whole capitals constantly employed in cultivation, and in case of accidents, would secure them a friend in the wealthy corn merchant, to diminish their dependence on the forbearance of their landlords. But I have already insisted longer than was necessary on this part of the subject, as the truth of the foregoing observations is, I believe, almost universally acknowledged in this part of the island, by all who, in their examination of the question, have formed their judgments on principles of justice, or of general expediency. The old popular prejudices, however, still maintain their ground among various descriptions of the com¬ munity, and will probably continue to do so, till the memory of our former laws is gradually obliterated by those more en¬ lightened ideas which Philosophy has disseminated, and which have been lately sanctioned by a unanimous decision of our Supreme Court. In the other part of the United Kingdom, 90 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH, the progress of truth and of liberality does not appear, in this instance at least: to have been equally rapid. The following has been stated as part of an address to the Grand Jury at the Shropshire Assizes 1795, by a judge highly respectable for his private character, and eminently distinguished by his profes¬ sional abilities A — “ Since I have been in this place, gentlemen, a report has reached me, (without foundation I sincerely hope,) that a set of private individuals are plundering at the expense of public happiness, by endeavouring, in this most abundant country, to purchase the grain now growing on the soil. For the sake of common humanity, I trust it is untrue. Gentle¬ men, you ought to be the combatants of this hydra-headed monster. It is peculiarly your duty to see justice done to the country. In your respective districts, as watchmen be on your guard. I am convinced from my knowledge of you, that I have no occasion to point out your duty in this case ; and that although the Act of Edward VI. be repealed, (whether wisely or unwisely, I take not upon me to say,) yet it still remains an offence at common law, coeval with the constitution ; and be assured, gentlemen, whoever is convicted before me, (and I believe I may answer for the rest of my brethren,) when the sword of justice is drawn, it shall not be sheathed until the full vengeance of the law is inflicted upon them : neither purse nor person shall prevent it.” In a cause tried before the Court of King’s Bench, 7th June 1800, the same judge is said to have expressed himself as follows : — u I am confident that the public do suffer greatly by machinations, which the Legislature cannot perhaps prevent. This is a very serious subject. Our ancestors thought it wise, in aid of the common law of our land, to enact a statute against forestalling the articles of food. This statute has been thought good policy, from the time of Edward VI. down to our memory ; but which was repealed, I know not why. Certainly those who repealed it thought they were acting wisely : at the same time, I rather think it might have appeared otherwise, upon 1 Lord Kenyon. — See Ferguson’s Memorial, CHAP. III. — OF TRADE. (§ 2.) 91 more mature deliberation. Men may form fine theories in their closets, but which men of a better knowledge of the world may know to be fallacious and delusive. A very eminent author published a very celebrated, and indeed an excellent work in many respects, the treatise On the Wealth of Nations , in which that ingenious author says, ‘ forestalling and regrating are no more to be dreaded than witchcraft/* Another person of high character, with some flaws in it,1 has since adopted that idea ; and he was the man to whose exertion was owing the repeal of the statute of Edward against forestalling. Undoubt¬ edly it would have been better if that statute had not been repealed. It is well the extent of the design in the repeal was not carried up to affect the common law of the land ; — I wish the old statute to he re-enacted/'2 What effect these doctrines have had in encouraging the common popular prejudices on this subject, we may judge from the following observations quoted literally from a Newspaper, which has a very extensive circulation in every part of this island. “ Next to the baneful influence of forestalled and regrators, we conceive the enormous farms held by individuals as one great cause of the present high price of provisions. They are a most intolerable evil, as they cause, in the first instance, the neglect of cultivation, and the unproductiveness of the land, while they enable the farmer to withhold his produce from the markets, and to speculate upon the distresses of the people. But if it be really desired to arrive at the root, and remedy this enormous evil, there can be no better device than a public register of the produce of the harvest in every parish of the kingdom, and a return of sales with the prices, the times, and the buyers' names. From Parishes, these registers should be sent and compared in the Hundreds, and from thence in the County Towns ; and finally, the common aggregate return should be transmitted to the Secretary of State for the Home * [Book IV. chap. v. ; Voi. II. p. 309, 2 See the Newspapers of the above tenth edition.] date. 1 Mr. Burke. 92 POLITICAL ECONOMY. — PAKT I. — BOOK II. — NAT. WEALTH. Department. Hence, it would at once appear whether there existed scarcity, or the danger of it, and in what degree it was felt or to be apprehended : hence, it would be known what counties were able to succour others which stood in need of it : hence, importation would be encouraged in time if it were needful, by a general competition and a plain calculation ; and hence would an enormous part of our capital, now employed only to oppress and starve the public, be driven into the channels of a just and profitable commerce. Perhaps our commercial principles have carried us quite far enough. If we are governed by our capital instead of governing it, — we have the words of Mr. Burke himself for it, who realized the doc¬ trines of Smith, — that it is the greatest of all calamities. Had this extraordinary man survived, he would have been the first to repeal his own statute, and to restore the salutary laws which he abrogated. 8. 152 POLITICAL ECONOMY.— -PART I.— BOOK II.— NAT. WEALTH. devoured by the Minotaur, than to have changed their ancient manners, and to have become a maritime power ; and Aristotle, although he frequently discovers a predilection for opinions contrary to those of his master, does not venture to contradict him in this particular. The prejudices of the Romans against the lucrative arts and professions were still more inveterate. Among such nations, accordingly, money-loans would be much less regarded in their relation to commercial speculations, than as subservient to the wants of the necessitous ; and the epithet barren , which Aristotle applies to money, shows plainly that it was in this point of view he considered them. Discreditable, however, as the trade of a money-lender was at Rome, a certain rate of interest was permitted by law, and a variety of regulations with respect to it established, which M. Dupuy has illustrated with much learning in the Appendix to his Memoir on the Roman Money. An interesting abstract of this Essay may be found in Paucton’s Metrologie. Usury is called by Mr. Gibbon “ the inveterate grievance of Rome/' iC After being discour¬ aged," he observes, u by the Twelve Tables, and abolished by the clamours of the people, it was revived by their wants and idleness, tolerated by the discretion of the Prastors, and finally determined by the Code of Justinian. Persons of illustrious rank were confined to the moderate profit of four per cent. ; six was pronounced to be the ordinary and legal standard of inter¬ est ; eight was allowed for the convenience of manufacturers and merchants; and twelve was granted to nautical insurance ; but except in this perilous adventure, the practice of exor¬ bitant interest was severely restrained."1 A very remarkable, and indeed singular instance of legisla¬ tive refinement on the subject of money loans , in times of the most remote antiquity, is mentioned by Sir William Jones in his Third Discourse , published in the Asiatic Researches. 61 In the first of the Sacred Law Tracts," he observes, ci which the Hindoos suppose to have been revealed by Menu some millions of years ago," — and which Sir William himself refers to a date long prior to the Christian era, — u there is a curious 1 Vol. VIII. p. 87, [Chap, xliv.] CHAP. III. — OF TRADE. (§ 3.) 153 passage on the legal interest of money, and the limited rate of it in different cases, with an exception in regard to adventures at sea; — an exception," says Sir William Jones, “which the sense of mankind approves, and which commerce absolutely requires ; though it was not before the reign of Charles I. that our English jurisprudence fully admitted it in respect of mari¬ time contracts." In this, however, as in many other instances of the information we have lately received from that quarter of the globe, we can only indulge our wonder, without possess¬ ing sufficient data to serve as a groundwork for satisfactory speculation. The low state of commerce in Greece and Rome, and the contempt in which it was held by those who governed public opinion, sufficiently account for the prejudice against loans for interest , so strongly expressed by their philosophers and states¬ men ; and this authority sanctioned by some passages in the Mosaic Law, naturally produced a still greater detestation for the practice in modern Europe, at a time when its commerce was confined to a few cities in Italy, or to the Hanse Towns, and when the only persons who exercised this trade, were held in universal odium on account of their religious principles. Indeed, abstracting entirely from these accessory circumstances, loans for interest can scarcely be looked on in a favourable light, except in connexion with an active and enterprising com¬ merce ; and it is only during the last three centuries that this has become an object of universal and of ardent pursuit, giving a commencement to those mighty changes which it seems destined to accomplish in the condition of the human race. The commerce of money among different nations , so wonder¬ fully facilitated by hills of exchange , is a branch of trade altogether of modern origin. In a state where there is little or no commerce, the great motive for borrowing is necessity ; and the only motives for lending must be humanity or avarice. In the former case, as the lender onlv advances a sum of money which would other- V wise have remained useless in his chest, the same disposition which induced him to succour the distressed will, in general , 154 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. prevent him from accepting a premium for an act of bene¬ ficence. In the case of lenders of a different description, who are anxious to turn to their own account the necessities of their fellow-creatures, it is reasonable to presume that their dealings will be governed by the same spirit which, in a commercial country, characterizes pawnbrokers, and others who make a traffic of the miseries of the poor. The value of a loan to an individual who is in want of bread, cannot be ascertained by calculation, as it may be when money is borrowed for the pur¬ poses of trade. The relief of the present moment seems cheaply purchased at any price, of which the payment is to be delayed to a distant day ; and it is not judging too harshly of human nature to suppose, that the demands of the lender, whose temper leads him to make a profession of this species of gaining, will rise in proportion to the distress of the borrower, and to the risk he runs of losing the principal. In a country, therefore, where there is no commerce, every money-lender who accepts of interest will be regarded in the same odious light in which pawnbrokers are considered among us ; and the man ee who putteth out his coin to usury/’ will be naturally classed (as he is in the words of Scripture) with “ him who taketh a reward against the guiltless.”* A very striking illustration of the effects which are naturally produced on the character by that sort of speculation, which has for its object the necessities of the poor, occurs in the history of the charitable corporation which was established about the year 1730, with the professed view of lending money to the poor upon pledges, so as to prevent their oppression by pawn¬ brokers. Many characters, respectable from rank, fortune, and reputation, belonged to this corporation ; but, in a short time, they were so corrupted by the trade they carried on, and the public cry was so loud against the iniquity of their transactions, that the House of Commons found it necessary to make a par¬ liamentary inquiry into their conduct, the consequence of which was, that the corporation was broken, and three of the managers who were members of the House were expelled. * [See Pscdm xv. 5.] CHAP. III. — OF TRADE. (§ 3.) 155 These remarks, while they account for the origin of the opinions concerning the practice of taking interest for money among those nations of antiquity whose commercial transactions were few and insignificant, will be sufficient, at the same time, to establish its reasonableness and equity in countries where money is most commonly borrowed for the purposes of com¬ mercial profit, and where, of consequence, the use of it has a fixed and determinate value, depending, like that of any com¬ modity in general request, on the circumstances of the market at the time. In such countries both parties are benefited by the transaction, and even the state is a gainer in the end. The borrowers of money are frequently among the most opulent of the community, who wish to enlarge their capitals and extend their trade, and who, by doing so, are enabled to give farther encouragement to industry, and to supply labour and bread to the indigent. It is not a little remarkable that John Calvin appears to have been one of the first who extricated himself entirely from the ancient prejudices on this subject. “ Pecunia non parit pecu- niam. Quid mare quid domus, ex cujus locatione pensionem percipio ? an ex tectis et parietibus argentum proprie nascitur ? Sed et terra producit, et mari advehitur quod pecuniam deinde producat, et habitationis commoditas cum certa pecunia parari commutarive solet. Quod si igitur plus ex negotiatione lucri percipi possit, quam ex fundi cujusvis proventu : an feretur qui fundum sterilem fortasse colono locaverit ex quo mercedem vel proventum recipiat sibi, qui ex pecunia fructum aliquem perceperit, non feretur ? et qui pecunia fundum acquirit, annon pecunia ilia generat alteram annuam pecuniam ? Unde vero mercatoris lucrum ? Ex ipsius, inquies, diligentia atque industria. Quis dubitat pecuniam vacuam inutilem omnino esse ? neque qui a me mutuam rogat, vacuam apud se habere a me acceptam cogitat. Non ergo ex pecunia ilia lucrum accedit, sed ex proventu. Him igitur rationes subtiles quidem sunt, et speciem quandam habent, sed ubi propius expenduntur, reipsa concidunt. Nunc igitur concludo, judicandum dc usuris esse, non ex particular]’ aliquo Scripturae loco, sed tantum ex 156 POLITICAL ECONOMY. — PART I.— BOOK II.— NAT. WEALTH. aequitatis regula.”* To those who are acquainted with the prevailing sentiments of Calvins time, this passage cannot fail to be an object of curiosity. Notwithstanding, however, this diversity of circumstances in the condition of ancient and modern nations, and the important changes it has operated on their opinions, it has by no means produced universally the effects which might have been ex¬ pected. A certain rate of interest is indeed allowed by law, and no person doubts of its being perfectly fair and honourable to receive it ; but everything above this legal rate is reprobated under the name of usury , as a crime of a very heinous nature, and, till the time of Queen Anne, was punished with confisca¬ tion of the usurer's whole moveables, the punishment being mitigated, since that period, to the forfeiture of thrice the sum usuriously lent. In order, too, to repress the crime still more effectually, our law allows of methods for the probation of it, which are contrary to the general maxims of common law. If there is a written bond in the hands of the usurer, he may be forced to exhibit his own bond in order to convict him¬ self, contrary to the common maxim, nemo tenetur edere instru- menta contra se. And where the crime cannot be proved otherwise, it may by the usurer's oath, contrary to the maxim which is received in other cases, nemo tenetur jurare in suam turpitudinem. There can be little doubt that these laws originated at first in prejudices which took rise in a very different state of society, but they have been powerfully supported by some considera¬ tions which have been generally supposed to demonstrate their political and commercial expediency. A few writers only have ventured to call this in question, and to express their doubts, whether the rate of interest should not be left, like the terms of other contracts, to be adjusted by the discretion of the parties. Among these, Mr. Bentham, of Lincoln's Inn, has particularly distinguished himself, in a very ingenious Treatise, entitled, A Defence of Usury , [1787,] in which he attempts to prove, “that no man of ripe years and of sound mind, acting freely and with * [Dpistolce. Quoted also in Dissertation , ( Works, Vol. I.) p. 530.] CHAP. TIL — -OF TRADE. (§ 3.) 157 his eyes open, ought to be hindered, with a view to his advan¬ tage, from making such bargain in the way of obtaining money as he thinks fit ; nor anybody hindered from supplying him upon any terms he thinks proper to accede to/7* The late Dr. Keid, too, in an Essay, read a good many years ago before a literary society in Glasgow, maintained nearly the same pro¬ position, and argued in support of it upon principles very similar to those employed by Mr. Bentham. Nor has the opinion been confined to our own country ; for it is maintained by several very eminent French writers, by M. Turgot, for example, and the whole sect of the Economists ; and it has been actually brought to the test of experience in different commercial states, particularly in Holland and at Hamburgh. The following passage from Turgot deserves to be quoted, as it states with equal clearness and conciseness the point on which the question turns : — “ It is an error to believe that the interest of money in trade ought to be fixed by the laws of princes. It has a current price, like that of all other merchandise. This price varies a little, according to the greater or less security which the lender has ; but, on equal security, he ought to raise and lower his price in proportion to the abundance of the demand ; and the law no more ought to fix the interest of money than it ought to regulate the price of any other commodities which have a currency in trade.77 I quote this passage from Turgot’s Reflections , &c. ; f but he has treated the subject at much greater length in a separate Essay, entitled, Memoire sur le pret a Inter et et sur le Com¬ merce des Fers. At a much earlier period I find the same doctrine advanced by the celebrated Mr. Law, in a memorial presented by him (before his elevation to the ministry) to the Kegent Duke of Orleans. This paper is entitled, Memoire sur T Usage des MonnoyeSj et sur le Profit ou la perte quit pent y avoir pour un Prince et pour un Etat , dans V. Alteration du Titre des has Monnoyes , et dans V Augmentation ou la Diminution de leur * [Letter I. Works, Vol. III. p. 3.] f [(Eumres, Tom. V. p. 88.] 158 POLITICAL ECONOMY. — PART I —BOOK II. — NAT. WEALTH. prix par rapport aux Etats voisins.1 ic L’Interet de la monnoye ne doit pas etre regie par le Prince. Je suppose quelle vaut presentement a genes quatre pour cent, qu on attend des vaisseaux d’Espagne avec des grosses sommes, si ces vaisseaux arrivent heureusement, Finteret baissera a trois. S’ils n’arri- voient pas, ne dois-je pas en profiter, et faire valoir mon argent cinq pour cent ? “ Le monnoye est comme une marchandise. J’ai un magazin de draps d’Angleterre, qui valent six livres la palme. Si le Prince regloit le prix de nos draps a six livres, il me feroit tort ; car s’ il arrive une quantite de draps, je ne trouverai plus a vendre les miens a six livres, je serai oblige de men defaire a moins, et le Prince ne me bonifiera pas le perte. “ Si ces draps n arrivent pas, comme je cours le risque de la perte, ne dois-je pas jouir du benefice que le prix naturel de mes draps me donne alors ? Pour reduire Finteret, il faut rendre le monnoye moins valable, en augmentant la quantite, ou en diminuant la de- mande. Il y a deux cent ans que Finteret etait a dix pour cent, presentement il est a cinq, et en quelques endroits a trois pour cent ; mais ce n’est pas la loi qui Fa detruit, cost V augmen¬ tation de la quantite de monnoye depuis la decouverte des hides.” In a note upon this passage by the author of the French work in which Law’s Memoir is published, the following remark is made : — - “ Les principes exposes jusqu’ici par M. Law sont d’une evidence a laquelle il est impossible de se refuser de bonne foi avec un esprit juste. Mais ici il commence a s’eloigner du vrai, pour avoir vu les choses trop en generale, sans faire attention aux circonstances particulieres ; et son systeme etoit une consequence de ce qu’il avance ici sur Finteret de Fargent. Si la circulation etoit fort rapprochee de son ordre naturel, il est probable que les princes n auroient pas besoin de regler les taux de Finteret. Mais comme dans les Poyaumes ou la circu- 1 i ublished in the second volume of a tions sur les Finances cle France depuis work entitled, Recherches et Considered V Annie 1595, jusqu'a V Annie 1721. CHAP. III. — OF TRADE. (§ 3.) 159 lation paroit le mieux etablie, il ne laisse pas de subsister un nombre infini de causes d obstruction, les proprietaires de Fargent composent toujours le plus petit nombre, ainsi ils exercent un veritable monopole/’ In support of this remark, a reference is made to a Dissertation on Interest , printed in the same volume, page 477, et seq. In this Dissertation, after stating some reasons against a legal rate of interest, the author adds : — “ II sensuit que le prix de Fargent ne devroit etre fixe plus que celui des autres denrees, dont Fabondance ou le rarete reglent le prix : mais la durete et Favidite des creanciers, les troubles que leurs rigueurs ont excites en divers etats, la facilite plus evidente de convertir Fargent en monopole a la faveur meme des gros interets que toute autre denree ; enfin depuis les conseils de la charite Chretienne ont engage les Legislateurs a intervenir dans une convention qui devoit etre libre de sa nature/7 The same author speaks afterwards of the opinion which reprobates the interference of legislative authority in this par¬ ticular, as having been first broached in France by Mr. Law. “ Une opinion apportee en France pour la premiere fois par M. Law ; c7est que Fetat ne doit jamais donner de reglemens, sur le taux de Finterets.77 “ Cette opinion,77 he continues, u vrai en soi , a cesse de l’etre dans la pratique par diverses circonstances, et peut-etre le seroit- elle encore, si jamais les Legislateurs ne fussent intervenus dans ces sortes de reglemens.1 Mais une fois qu’ils se sont charges de ce soin, il sembleroit a craindre que jamais la benefice dune diminution ne fut generale dans un etat. L ’experience prouve du moins que Fancien taux fournit toujours aux futures des moyens de difficultes et d7embarras qui tiennent l’int^ret au dessus de son cours naturel. L’emploi de Fargent dans les effets publics se fait aujourd’hui sur le pied de quatre a quatre et demi pour cent, et le pret marchand continue d etre a six,7 &c. &c. The reasoning which follows is so inconclusive, that it is not worth while to transcribe it. 1 Locke’s opinion on the subject seems bis Works, Vol. II. p. 31. [(First) Can¬ to coincide with this very nearly. See siderations on Interest and Money.] 160 POLITICAL ECONOMY.— PART L— BOOK II. —NAT. WEALTH. On the other hand, the prevailing ideas among our com¬ mercial politicians in this island are (if I am not mistaken) in favour of our existing laws ; and they are supported by an authority justly entitled to the highest respect on all questions of Political Economy, that of Mr. Adam Smith.* Indeed, I do not recollect that any writer of note (excepting the two already mentioned) have ventured to dispute the expediency of this part of our code ; although a pretty strong presumption obviously presents itself against it, from the example of the Dutch and Hamburghers, and the total silence of our political writers on the subject during the ten years that have elapsed since the publication of Mr. Bentham’s Essay. A very com¬ petent judge, Sir Francis Baring, in his late Pamphlet, On the Bank of England , [1797,] has not scrupled to say that Mr. Bentham s Essay still remains unanswered, for the best of all possible reasons, that it is perfectly unanswerable. Another very obvious consideration, which may well excite our curiosity in examining the expediency of our existing laws on this subject, is suggested by the variations in the rate of interest (whether established by law or by custom) among different nations, and in the same nation at different periods. Among the Romans, till the time of Justinian, we find it as high as twelve per cent. In England, so late as the time of Henry VIII., we find it at ten per cent. Even at present in Ireland, it is at six per cent. ; and in the West Indies at eight per cent. ; and in Hindostan, where there is no rate limited by law, the lowest customary rate is ten or twelve. At Constantinople, in certain cases, thirty per cent, is said to be a common rate. Now, of all these widely different rates, what one is there that is intrinsically more proper than another P What is it that evinces this propriety in each instance ? — what but the mutual convenience of the parties, as manifested by their consent ? It is convenience, then, that has produced whatever there has been of custom in the matter ; what can there then be in custom to make it a better guide than the convenience which * | Wealth of Nations, Book II. chap. iv. ; Yol. II. p. 44, tenth edition.] « CHAP. HT. - OF TRADE. (§ 3.) 1(51 gave it birth ? and what is there in convenience that should make it a worse guide in one case than in another ? It would be convenient to me to give six per cent, for money : I wish to do so. “ No/' says the Law, “ you shan't/' Why so ? “ Because it is not convenient for your neighbour to give above five for it." The absurdity of the reason surely does not stand in need of any comment. Much has not been done as yet by legislators in order to fix the price of other commodities ; and in what little has been done the wisdom of their regulations is very far from being generally acknowledged. Putting money out at interest, is ex¬ changing present money for future ; but why a policy, which, as applied to exchanges in general, would be commonly deemed absurd and mischievous, should be deemed necessary in the instance of this particular kind of exchange, is a proposition about which it is surely reasonable to hesitate, till it has been carefully considered. For him who takes as much as he can get for the use of a house, or of any other article of value, there is no particular appellation, nor any term of reproach : nobody is ashamed of doing so, nor is it usual so much as to profess to do otherwise. Why a man who takes as much as he can get, be it six, or seven, or eight, or ten per cent, for the use of a sum of money, should be called usurer , or loaded with any other opprobrious name, any more than if he had bought a house with it, and made a proportionable profit by the house, it is not easy to imagine ; upon that general view of the question, at least, which first presents itself to our notice. I proceed, therefore, now to a closer examination of the sub¬ ject ; for which purpose I shall consider, First , the various arguments that have been alleged in favour of that limitation of interest which is fixed by our laws ; — after which I shall [Secondly] point out some of the inconveniences which these laws seem likely to produce. In both discussions I shall avail myself, without scruple, of the ideas of Mr. Bentham, wherever they appear to me to be useful for establishing the conclusions I have in view. VOL. IX. 162 POLITICAL ECONOMY. — PARTI. — BOOK II. — NAT. WEALTH. Before, however, I enter on the general question, I think it necessary to remark, that those who dispute the expediency of anti-usurious laws, argue against these laws only so far as they are supposed to abridge the liberty of the contracting parties ; for in cases where there is no contract, it seems to be manifest that the rate of interest should be fixed by law. Such cases may happen from many different causes. When a sum of money, for instance, becomes due, the right to it is litigated by the debtor. The litigation continues for years, the money in the meantime remaining in the hands of the debtor. At last he is found not only to have disputed the debt on insufficient grounds, but not even to have had what the law calls a pro- babilis causa litigandi. Here it is just that he not only pay the principal but the interest on it, while the money, in con¬ sequence of his unfounded claim, was withheld from the creditor ; and in such a case it is necessary that the rate of interest should be determined by law. Again, suppose a man is abroad when a sum falls due to him, and that he has no attorney who has power to receive it, the debtor keeps it in his hand and uses it for years ; here there is no contract to fix what the rate of interest shall be, and therefore it is proper that law should supply the defect. The case of tutors who have the administration of the money of minors is very similar. In these cases, and others of like nature, where there was not any bargain between the parties what the rate of interest should be, it seems proper and necessary that it should be determined by law. And for this purpose two different plans might be proposed : First , by a constant rate fixed at once by the Legislature, to take place in all cases, without regard to the casual variations of the market rate ; a plan which is adopted in our own country, where five per cent, has been fixed ever since the reign of Queen Anne, as the rate which may be legally demanded if no express stipulation has been made to the contrary. Or, Secondly , the rate of interest payable in cases where there is no contract, might be fixed annually by a jury, as near to the market rate for the time as can be done ; in like CHAP. III. - OF TRADE. (§ 3.) 163 manner as the price of grain in Scotland is fixed annually by a jury in what is called the fiars. Taking for granted, therefore, as a point about which there cannot be any dispute, that there ought to be a fixed rate of interest for the adjustment of all differences that may arise among parties who have not previously settled the terms of their money-contracts, let us consider the reasons that may be alleged for a legal rate by which the terms of every such con¬ tract are to be restrained within certain limits. Of these reasons one of the most plausible is founded on the expediency of maintaining, as far as possible, habits of economy in the great body of a people, and of checking the thoughtless¬ ness and extravagance of those who are in danger of ruining their fortunes by prodigality. Were it not for this class of men, Sir James Steuart is of opinion that there would be no occasion for a statute to regulate the rate of interest. “ The profits of trade,” he observes, u would strike an average among the industrious classes, and that average would fall or rise, in proportion to the flourishing or decay of commerce.”1 A case, therefore, which appeared to this ingenious and profound writer to be so strong as of itself to justify the policy of Anti-usurious Laws, will require to be considered with particidar attention.2 In examining the grounds on which this opinion rests, I shall wave entirely the general question, whether it ought to be one of the objects of law to impose restraints on the prodigality of spendthrifts. It is sufficient for our purpose to remark, that in so far as this is the aim of the Anti-usurious Laws, they are altogether inadequate to the end proposed. In proof of this, let us attend to the situation in which per¬ sons of this description are placed : First , on the supposition that the prodigal has some security to offer for the money he borrows ; and, Secondly , on the supposition that he has none. In the first case, it seems to be abundantly manifest, that so 1 Political (Economy , [Book IV. chap. the expediency of these laws nearly on iv. ; Works, Yol. III. p. 158.] the same consideration, Vol. II. p. 31. [(First) Considerations on Interest and 2 Mr. Locke, too, rests his opinion of Money.] 1G4 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. long as the prodigal lias any thing to pledge or to dispose of, whether in possession or even in reversion, no Anti-usurious Laws can he efficacious in checking his extravagance. While he has ready money of his own, or effects which he can turn into ready money without loss, he will never think of borrowing money to spend ; and when at last these resources fail him, so long as he has security to give, equal to that upon which money is to be had at the highest ordinary rate, he has no occasion, nor is at all likely to borrow money at an extraordinary in¬ terest. It is true that from persons of this disposition regular payment of interest is not to be expected ; but supposing the money-lender to be satisfied with the security, he will seldom hesitate about the loan, in consequence of any apprehensions founded on the character of the borrower. On the contrary, Mr. Bentham observes, that where the security is good, there will be always found a sufficient number of money-lenders, with whom a disposition to prodigality will operate as a recom¬ mendation. In confirmation of this he mentions the advantage to be made in case of mortgage, by foreclosing or forcing a sale ; an advantage which, he says, is not uncommonly looked for in transactions of this nature, ££ as is well known to all who have had occasion to observe the course of business in the Court of Chancery.”* It remains for me only to mention, under this head, the case of those who, although they have no real or good security to offer, have some contingency in prospect, which they may wish to avail themselves of, in supporting their credit. In such instances there will be found, no doubt, money-lenders, who (if there were no laws to the contrary) would be willing to run the risk for an extraordinary profit : And it may be imagined that the penalties on usury may be useful in preventing the prodigal from advancing farther in his ruinous career. But is this really the case ? So much the reverse that our Anti- usurious Laws only aggravate the evil they are meant to remedy. The following dilemma may be fairly stated on the subject : — Either these laws are effectual in restraining usury, * [Defence of Usury, Letter iii. ; Works , Vol. III. p. 6.] CHAP. III. — OF TRADE. (§ 3.) 165 or they are not. If they are perfectly effectual in restraining usury, they drive the prodigal to despair, and force him to sell his contingency. If they are not effectual, they are in so far nugatory ; and what is worse by the penalties which await the usurer in the event of a discovery, they enhance the demand which he makes on the borrower. With respect to the second class of prodigals, those who have no security to offer, either of a certain or of a contingent nature, a very few words may suffice. If they are able to raise any money, it can only be lent on the score of friendship or of humanity ; in either of which cases an extraordinary rate of interest is out of the question. From those who make a trade of money-lending, they have nothing to expect either at the ordinary or at an extraordinary rate : — And the very circum¬ stance of offering the latter, would amount to a confession of that desperate state of credit and of character, which has exhausted all the common resources of attachment and generosity. The way in which prodigals run into debt, after they spend their substance, is in general, by borrowing of their friends and acquaintance, at ordinary interest, or more commonly at no in¬ terest, small sums, such as each man may be content to lose, or be ashamed to ask real security for. This is the race which prodigals, who have spent their all, run at present, under the actual system of restraining laws ; and this, and no other, would be the race they would run, if these laws had no existence. In order to complete this argument with respect to the in¬ efficacy of Anti-usurious Laws as a restraint on prodigality, the following consideration is very forcibly stated by Mr. Bentham. “ In spite/’ says he, u of all laws against usurers, there is an¬ other set of people from whom prodigals get what they want, and always will get it so long as they have any credit remain¬ ing, and should they find it necessary, at an expense more than equal to any excess of interest they might have to give ; 1 mean the tradesmen who deal in the goods they want. Every - body knows it is much easier to get goods than money. People 16G POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. trust goods upon much slenderer security than they do money. It is very natural they should do so ; ordinary profit of trade upon the whole capital employed in a man s concerns, even after the expense of warehouse rent, journeymans wages, and other such general charges are taken into the account, is at least equal to double interest, or ten per cent. Ordinary profit upon any particular parcel of goods must, therefore, be a great deal more : Suppose — for the sake of illustration — fifteen per cent, in the way of trading, then a man can afford to be at least three times as adventurous, as he can in the way of lend¬ ing, and with equal prudence. So long, then, as a man is looked upon as one who will pay, he can much easier get the goods he wants, than he could get the money to buy them with, though he were content to give for it twice, or even thrice, the ordinary rate of interest. From these considerations it appears how very idle it is pre¬ venting a man from making six or seven, or eight per cent, interest, when, if he chooses to run a proportionable risk, he may in this way make thirty or forty per cent., or any rate you please. And, as to the prodigal, if he cannot get what he wants upon these terms, what chance is there of his getting it upon any terms, supposing the laws upon usury to be repealed ? This, then, is another way, in which, instead of serving, it injures him, by driving him from a market which might have proved less disadvantageous, to a more disadvantageous one : and consequently, the effect of the Anti-usurious Laws with regard to prodigality, if they have any effect, is to increase the evil complained of. Besides prodigals, there are three other classes of persons for whose security these restrictive laws may be supposed to have been designed. The first is the indigent ; the second , the in¬ ter prising and adventurous , (or, in one word, projectors ;) the third, those whose simplicity renders them incompetent to the management of their own concerns. As for the first class, the inexpediency of the Anti-usurious Laws (in so far as they are interested) follows as an obvious consequence from the unlimited variety of situations, in respect CHAP. III. - OF TRADE. (§ 3.) 167 of the degree of exigency in which the indigent may be placed. No principle can well be conceived more indisputable than this, that the consideration a man pays for borrowed money ought in prudence, to vary with the advantage he expects to derive from the use of it, or the need he may have of the money at the time ; and therefore, as the advantage or the necessity ad¬ mits of an undetermined number of degrees, so may the terms of the loan, considered merely in a prudential point of view. If, for example, one man can make eleven per cent, by the use of money, where another can make but ten, six per cent, may be as prudentially given by the former, as five per cent, by the latter. In like manner, on the other hand, if an apprehended loss would amount to eleven per cent., six per cent, would be as reasonable and prudential a consideration to stipulate, as five per cent, would be in the case of a borrower who had a loss amount¬ ing to ten per cent., from which to save himself by the same means. And in any case, though in proportion to the amount of the loss, the rate of interest were ever so great, as that the clear saving should not amount to more than one per cent., or any fraction per cent. ; yet so loug as it amounted to anything, he would be just so much the better for borrowing, even on such comparatively disadvantageous terms. If, instead of gain, we put any other kind of benefit or advantage — if, instead of loss, we put any other kind of mischief or inconvenience, of equal value, the result will be the same. The conclusion to which these observations lead is plainly this, — that as no legislator can judge so well as each individual for himself, whether money is worth to him anything, and how much beyond the ordinary interest, the interference of law in regulating the terms of money contracts, is not only officious and useless, but is actually prejudicial to those whom it is meant to serve. With respect to the second class of men, whose rashness the Anti-usurious Laws may have a tendency to restrain, (I mean projectors ,) the operation of these laws will require a more ample consideration ; because, in this instance, they ha\ e found an advocate in no less an author than Mr. Smith, whose general 168 POLITICAL ECONOMY. — PARTI. — BOOK II. — NAT. WEALTH. principles concerning the freedom of trade and of industry, one should naturally have expected, would have inclined him to the opposite opinion. Here, however, Mr. Smith has met with a very acute and able antagonist in Mr. Bentham, who has sub¬ joined to his Defence of Usury , a Letter addressed to Mr. Smith, containing a variety of remarks on the pernicious effects of our present laws, in consequence of the discouragements which they oppose to the progress of inventive industry. These remarks seem to me to present unanswerable objections to this part of Mr. Smith's system. The passage in the Wealth of Nations in which the opinion in question is stated, is as follows, — a The legal rate, it is to be observed, though it ought to be somewhat above, ought not to be much above the lowest market rate. If the legal rate of interest in Great Britain, for example, was fixed so high as eight or ten per cent., the greater part of the money which was to be lent, would be lent to prodigals and projectors, who alone would be willing to give the high inter¬ est. Sober people who will give for the use of money no more than a part of what they are likely to make by the use of it, would not venture into the competition. A great part of the capital of the country would thus be kept out of the hands which were most likely to make a profitable and advantageous use of it, and thrown into those which were most likely to waste and destroy it. Where the legal interest, on the con¬ trary, is fixed but a very little above the lowest market rate, sober people are universally preferred as borrowers to prodigals and projectors. The person who lends money, gets nearly as much interest from the former as he dares to take from the latter, and his money is much safer in the hands of the one set of people, than in those of the other. A great part of the capital of the country is thus thrown into the hands in which it is most likely to be employed with advantage.”* That there is somthing not altogether sound in the principles implied in this passage, might, I think, be naturally suspected, from the following consideration, that the law, and therefore * [Book II. chap. iv. ; Vol. II. pp. 44, 45, tenth edition.] 169 CHAP. III. — OF TRADE. (§ 3.) the censure passed on projectors by the approbation given to that law, admits of no discrimination in favour of the reasonable and meritorious individuals who may frequently be compre¬ hended under that invidious denomination. The censure falls upon all such persons as, in the pursuit of wealth, or even of any other object, endeavours, by the assistance of wealth, to strike into any channel of invention. It falls upon all such persons as, in the cultivation of any of the useful arts, direct their endeavours to any of those departments in which their utility shines most conspicuous and indubitable ; upon all such persons as, in the line of any of their pursuits, aim at anything that can be called improvement ; whether it consist in the pro¬ duction of any new article adapted to man's use, or in the meliorating the quality, or diminishing the expense, of any of those which are already known to us. It falls, in short, upon every application of the human powers in which J ingenuity stands in need of wealth for its assistant. Mr. Smith himself plainly uses the word project in the most extensive acceptation of that term. “ The establishment of any new manufacture," he remarks in another part of his work, “ of any new branch of commerce, or of any new practice in agriculture, is a specula¬ tion from which the projector promises extraordinary profits. These profits," he adds, “are sometimes very great , and some¬ times, more frequently perhaps , they are quite otherwise ; but in general they bear no regular proportion to those of other old trades in the neighbourhood. If the project succeeds, they are commonly at first very high. When the trade or practice becomes thoroughly established and well-known, the competi¬ tion reduces them to the level of other trades."* The question, therefore, comes plainly to this, not whether it would be useful to the public to discourage rash and useless projects, but whether it would be useful to discourage the pro¬ jecting spirit in general. Indeed, it is only in this last way that our present laws can have any effect, by lessening the total number of projectors, without lessening the proportion ol bad to good. * [Ibid. Book J. cliap. x.; Vol. I. p. 177, tenth edition.] 170 POLITICAL ECONOMY. — PART I. — BOOK JI. — NAT. WEALTH. That the projector cannot hope for money at the highest rate of interest which is legal at the time, because that may always be had with more safety from old established trades, is very justly remarked by Mr. Smith. But what is the conse¬ quence P That our Anti-usurious Laws operate as a check on all who are ambitious to follow the steps of those who have distinguished themselves as the benefactors of the human race. For whatever prejudice may be entertained against projects and projectors, it is nevertheless an indisputable truth, (to use the words of Mr. Bentham,) that ce whatever is now the routine of trade, was at its commencement project , whatever is now establishment , was at one time innovation.”* The approbation bestowed by Mr. Smith on these laws in their particular application to projectors , is the more surprising, that it seems to be in direct opposition to some of his funda¬ mental maxims. “ With regard to misconduct,” he observes, “ the number of prudent and successful undertakings is every¬ where much greater than that of injudicious and unsuccessful ones. After all our complaints of the frequency of bankruptcies, the unhappy men who fall into this misfortune make but a very small part of the whole number engaged in trade, and all other sorts of business, not much more, perhaps, than one in a thousand. In another passage, speaking of the effects of prodigality to retard the accumulation of National Wealth, Mr. Smith repre¬ sents them as far too inconsiderable to call for the interposi¬ tion of Government, and even censures, with some degree of asperity, die folly and presumption of statesmen in attempting to remedy the evil. u It is the highest presumption and im¬ pertinence in kings and ministers to pretend to ivatch over the economy of private people , and to restrain their expense, either by sumptuary laws, or by prohibiting the importation of foreign luxuries. They are themselves always, and without exception, the greatest spendthrifts in the society. Let them look well after their own expense, and they may safely trust private * [ Defence of Usury , Letter xiii. ; + [ Wealth of Nations , Book II. chap. Tfor&s, Yol. III. p. 22.] iii. ; Vol. II. p. 20, tenth edition.] 171 CHAP. III. — OF TRADE. (§ 3.) people with theirs. If their own extravagance does not ruin the state, that of their subjects never will.” * If this consideration, so forcibly stated by Mr. Smith, furnish a good argument against the interposition of law in restraining the prodigality of individuals, it concludes with tenfold force against its interference in the case of projectors ; for this obvious reason, that prodigality is much more certainly ruinous, and much more common, than projecting ; to which we may add, that in controlling prodigality, the law controls passion by reason ; in controlling projects, it controls knowledge by ignorance. On this last topic, nothing better can be offered than the following passage from Mr. Smith : — Ci What is the species of domestic industry which his capital can employ, and of which the produce is likely to be of the greatest value, every indivi¬ dual, it is evident, can, in his local situation, judge better than any statesman or lawyer can do for him. The statesman who should attempt to direct private people in what manner they ought to employ their capitals, would not only load himself with a most unnecessary attention, but assume an authority which could safely be trusted, not only to no single person, but to no counsel or senate whatsoever, and which would be no¬ where so dangerous as in the hands of a man who had folly and presumption enough to fancy himself lit to exercise it. “ To give the monopoly of the home market to the produce of domestic industry, in any particular art or manufacture, is in some measure to direct private people in what manner they ought to employ their capitals, and must in almost all cases be either a useless or a hurtful regulation .”f Nothing certainly can be more just and satisfactory than these remarks ; and we may add to them, that to limit the legal interest to a rate at which the carriers on of the oldest and best established and least hazardous trades are always glad to borrow, is to give the monopoly of the money market to the trades, against the projectors of new imagined trades ; not * [Ibid. ; Yol. II. p. 27, tenth f [Ibid. Book IV. chap. ii. ; Vol. 1 1 . edition.] P- 182, tenth edition.] 172 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. one of which but must appear more hazardous than the old, were it only from the circumstance of its novelty. It has been already observed, that the censure on projects involves all past improvements ; and as in this extensive appli¬ cation of it, no person can pretend to vindicate it, who does not prefer the savage to the civilized state of society, it may be reasonably presumed that the greater part of those from whom it has proceeded, have made some tacit exception in favour of those projects which have been already brought to the test of experience. And yet, admitting the principles on which the maxim is founded to be just, they unquestionably apply with far greater force to the past than to the future ; inasmuch as every unsuccessful project furnishes additional lights to those who are afterwards to follow the same career of experiment and invention. The career of art, the great road which receives the footsteps of projectors, is beautifully and happily compared by Mr. Bentham* to a vast plain bestrewed with gulfs, such as Curtius was swallowed up in. Each requires a human victim to fall into it ere it can close ; but when it once closes, it closes to open no more, and so much of the path is safe to those who follow. If the want of perfect information of former mis¬ carriages, renders the reality of human life less happy than this picture, still the similitude must be acknowledged, and we see at once the only plain and effectual method for bringing that similitude still nearer and nearer to perfection ; I mean the framing the history of the projects of time past, and the making provision for recording, and collecting, and publishing, as they are brought forth, the race of those with which the womb of futurity is still pregnant. It is indeed comfortable to reflect, that this state of con¬ tinually improving security is the natural state not only of the road to opulence, but of every other track of human life. In the war which industry and ingenuity maintain with fortune, past ages of ignorance and barbarism form the forlorn hope which has been detached in advance, and made a sacrifice of * [Defence of Usury , Letter xiii. ; Works, Vol. Ilf. p. 26.] CHAP. III. — OF TRADE. (§ 3.) 173 for the sake of the future. The golden age, it is but too true, is not the lot of the generation in which we live ; hut if it is to be found in any part of the track marked out for human existence, it will be found, (we may venture to hope,) not in any part which is past, but in some part which is yet to come. So much for the argument for Anti-usurious Laws founded on their supposed tendency to repress the hurtful rashness of projectors. It yet remains, before concluding this part of the subject, to say a few words on their supposed utility in pro¬ tecting [the third class,] the simple and inexperienced from the arts of the fraudulent. I have already taken notice of the great variety of circum¬ stances on which the reasonableness of the terms of a money- contract depends, circumstances which vary with the condition of the parties between whom the contract is formed. Is it not then a most extraordinary expedient, in order to prevent the advantage which the designing may take of the weak, to con¬ fine all those, without exception, who may have occasion to engage in transactions of this nature, to one fixed rate of interest, which they are prohibited to go beyond, under the severest penalties P Is not such a regulation likely to do more mischief on the whole, than the accidental frauds which may now and then be practised on such individuals as are possessed of that degree of understanding which allows them the general management of their own affairs. But farther, if the law thinks proper to fix the maximum, of interest in pecuniary bargains, why does it not also fix a minimum with as severe a penalty upon the man who borrows at a lower rate ? The borrower and lender are equally entitled to favour from the legislator, as both are to be presumed equally capable to understand their own interest. The one has the same interest in lending that the other has in borrowing ; and there is nothing that should give the one an advantage over the other in making the bargain. It seems evident that the legislator goes upon the idea of those times when the borrowers were the poor and necessitous, who being liable to great oppression from the rich usurer, were entitled to favour 174 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. and protection ; but the lenders now are as poor and necessitous as the borrowers. In a commercial country they are indeed more so ; because they comprehend the widow, the orphan, the aged, and infirm, who often live upon the interest of a small stock. In this case, then, the law guards the rich against the oppression of the poor, when it intends only to guard the poor against the oppression of the rich. Suppose a man worth £3000, lends to a weak man of equal fortune £1000, and by imposing on his ignorance or weakness, makes him agree to pay for it six per cent., that is, defrauds his weak neighbour of £10 ; — the law determines that, for this fraud, he shall not only make restitution, but, moreover, shall forfeit £3000, that is, all that he has ; and the forfeiture would have been the same if the fraud had only amounted to tenpence. Suppose, now, the borrower to be the sharper, and that he persuades a simpleton to lend the £1000 at four per cent, when he might have five. His crime appears to be perfectly equal to the crime we first supposed in the lender ; nor is it possible for the nicest casuist to discern a grain of guilt in the one that is not in the other. Yet in the one case the law pronounces absolute ruin against the fraudulent lender, while in the other it allows the fraudulent borrower to pass altogether unpunished. But waving these considerations, and supposing, for a moment, not only that the protection of the simple in the borrowing of money is a fair and proper object of law, but that it is in the power of the legislator in this instance completely to accom¬ plish the proposed end, what advantage is gained so long as there are so many similar occasions, as there ever must be, where the simplicity of the individual is equally likely to make him a sufferer, and on which the legislator cannot interpose with effect, nor has ever so much as thought of interposing ? Buying goods with money, or upon credit, is the business of every day ; borrowing money is the business only of some par¬ ticular exigency, which in comparison can occur but seldom. Regulating the price of goods in general wrould be an endless task, and no legislator has ever been weak enough to think of attempting it ; and supposing he were to regulate the prices, CEiAP. III. - OF TRADE. (§ 3.) 175 what would that signify for the protection of simplicity, unless he were to regulate also the quantum of what each man should buy ? But in what degree soever a man's weakness may expose him to imposition, he stands much more exposed to it in the way of buying goods than in the way of borrowing money. To be informed, beforehand, of the ordinary prices of all the sorts of things a man may have occasion to buy, may be a task of con¬ siderable variety and extent. To be informed of the ordinary rate of interest, is to be informed of one single fact, too interest¬ ing not to have attracted attention, and too simple to have escaped the memory. Even in regard to subjects whose importance might be supposed to justify a regulation of their price by the legis¬ lator, (such, as for instance, land,) it may be doubted whether there ever was an instance where, without some such ground as, on the one side, fraud, or suppression of facts necessary to form a judgment of the value, or at least ignorance of such facts on the other, a bargain was rescinded, merely because a man had sold too cheap, or bought too dear. Were I to take a fancy to give a hundred years' purchase instead of thirty for a piece of land, rather than not have it, where is the court that would interpose to hinder me, much less to punish the seller with the loss of three times the purchase-money, as in the case of usury ? Yet, when I had got my piece of land and paid my money, repentance, were the law even so well disposed to assist me, might be unavailing ; for the seller might have spent the money, or gone off with it. But in the case of borrowing money, it is the borrower always who, according to the inde¬ finite, or short term for which money is lent, is on the safe side ; any imprudence he may have committed with regard to the rate of interest may be corrected at any time. If I find I have given too high an interest to one man, I have no moie to do than to borrow of another at a lower rate and pay oft the first ; if I cannot find another to lend me at a lower, there cannot be a more certain proof that the first was not in reality too high. 176 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. Some measures of police, indeed, might perhaps be useful in such an overgrown city as London, for checking the exorbitant impositions which are there practised in the loan of petty sums to that humble class of traders who expose their wares in the streets for sale. Mr. Colquhoun, at least, by whom this singular species of banking was first brought under the public notice, says, that it is highly injurious to the morals of those who are concerned in it ; and, although something might be advanced on the other side of the question, I shall not venture to say that he is entirely wrong. The object of this trade, which is chiefly carried on hy females, is to accommodate those women who sell fish and other goods on the streets, with such small sums as may be necessary for their daily demand. The usual diurnal stock is said to be five shillings, for the use of which for twelve hours they pay sixpence when the money is returned in the evening, the lender thus receiving £7, 10s. a year for every five shillings. il In contemplating,” says Mr. Colquhoun, “ this very curious species of banking, (trifling as it seems to be,) it is impossible not to be forcibly struck with the immense profits that arise from it. It is only necessary for one of these female sharpers to possess a capital of seventy shillings , or £3, 10s., with fourteen steady and regular customers, in order to realize an income of one hundred guineas a-yearC* If any regula¬ tions of police should be thought necessary for correcting such practices, which originate entirely in the ignorance and bad habits of the populace in a large and luxurious city, no inference can be drawn from them to invalidate the reasonings stated by Mr. Bentham ; nor would it be even fair to conclude that such transactions are universally accompanied with all the mischiefs which Mr. Colquhoun affirms arise from this practice, as carried on at present. The truth is, that Mr. Colquhoun does not seem to be sufficiently aware of the circumstances which justify the equity of a lender in exacting a higher pro¬ portional premium for the loan of a small sum than for the loan of a large one, nor of the circumstances which, in the case of a small trade, justify the prudence of a borrower in consent- * [ Treatise on the Police of the Metropolis , Chap. v. p. 128, seventh edition.] CHAP. III. 177 — OF TRADE. (§ 3.) ing to such conditions. One of these circumstances is, that the iisk is greater, as in small loans the profit is not sufficient to defray the expense of examining with sufficient minuteness into the circumstances of the borrower ; a second, and far stronger is, that the borrower of a small sum can afford to give a higher interest than the borrower of a large one. The value of loans to a small amount is often so great that it can scarcely be said to bear any proportion whatever to that of large sums. As an example, we may observe the case of a labouring man having an opportunity of getting employment, but in want of five shillings to purchase the necessary tools, while his master rigidly adhering to the custom of the trade, refuses to furnish them himself. In such a case, which I understand occurs very frequently in England, the labourer, if he could get five shil¬ lings, would be able to repay it in a few days with large interest. It would be difficult to find a case where a thousand pounds could be laid out so as to produce such advantages. I proceeded, at our last meeting, to make some observations on the motives which have influenced the policy of different nations in subjecting the commerce of money to the regulation of law. The general principles which regulate the rate of in¬ terest, independently of the interposition of statesmen, I touched on slightly in a former Lecture, without aiming at so full an illustration of the subject as it might have been proper for me to attempt, if it had not already been placed in so clear a light Ly the united abilities of Mr. Hume and of Mr. Smith. Among the writers who have disputed the expediency of legal restraints on the rate of interest, I mentioned M. Turgot, Mr. Bentham, and the whole of that class of politicians known in France by the title of Economists, [supra, p. 157.] To these I added the name of the celebrated Mr. Law, who, from a Memoir presented, before his elevation to the ministry, to the Kegent Duke of Orleans, appears to have held the same opinion. The arguments he employs in support of it are expressed with that clearness and conciseness which in general distinguish his writ¬ ings. The Memoir to which I refer is to be found in the sixth 178 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. [second ? — see above, p. 158] volume of a French work, entitled, Researches and Considerations on the Finances of France, from the year 1695 to the year 1721, p. 181 ; edition of Liege 1758. In the same volume, this doctrine concerning the freedom of money-loans is, as I have above stated, ascribed by the editor to Mr. Laio as its author , or at least, as its first hroacher in France. “ Une opinion apportee en France pour la premiere fois par M. Law, c’est que fetat ne doit jamais donner cle Reglemens sur le taux de finteret,” page 64. In what I have already said on this subject, I have chiefly followed Mr. Bentham, who has traced the consequence of the general principle more minutely than any of his predecessors. I propose to prosecute the same argument this evening, re¬ questing it may always be remembered, that in considering questions of this nature, which have divided the sentiments of those who have considered them with much more attention than it has been in my power to bestow on them, I would be always understood to express myself with diffidence ; and that the general aim of these speculations is not to inculcate par¬ ticular conclusions, but to promote a spirit of free discussion. That the arguments commonly alleged in favour of Anti- usurious Laws are not sufficient to establish their expediency or equity, may, I flatter myself, be safely inferred from the remarks formerly stated. I shall confine myself, therefore, in what follows, to a view of the mischievous effects which they seem likely to produce. The first I shall mention is that of prechiding so many people altogether from the possibility of obtaining the money they stand in need of, to answer their respective exigencies, and what is worse, that precise description of people whose necessity is the greatest. In this point of view, then, the sole tendency of the law is to aggravate the distress of the unfortunate. While, however, the law thus precludes a man from borrow- ing upon terms which it deems too disadvantageous, it does not preclude him from selling upon any terms, however ruinous. Everybody knows that forced sales are attended with a loss ; and to this loss, what would be deemed a most extravagant 171) CHAP. III.— OF TRADE. (§ 3.) interest bears in general no proportion. When a man’s move¬ ables are taken in execution, they may be reckoned pretty well sold, if, after all expenses paid, the produce amounts to two- thirds of what it would cost to replace them. In this case, the well-meant interference of the law costs the debtor thirty-three per cent. If a man’s fortune consists in immovable property, the fluctuations in the value of land, occasioned by the varying circumstances of the country, may sometimes lay him under a necessity of disposing of his estate to a still greater disadvan¬ tage. During the distress occasioned by the American war, lands, which it was necessary should be sold, were sold at London, by public auction, at twenty, eighteen, nay, in some instances, as low as fifteen years’ purchase, whereas before the war, thirty years’ purchase for land was reckoned a medium price. Could any rate of interest, at which the seller might have raised money by loan, have injured his fortune nearly in the same proportion ? What has been hitherto said is confined to the case of those who have present value to give for the money they stand in need of. If they have no such value then if they succeed in purchasing assistance upon any terms, it must be in breach of the law. Even in this case, however, the mischievous influence of the law still pursues them, aggravating the very mischief it pretends to remedy. Though it be not completely efficacious in the way that the legislator proposes, it is perfectly so in the way opposite to that which he has in view. The effect of it is to raise the rate of interest higher than it would be otherwise, and that in two ways. In the first place, a man must, in common prudence, as Mr. Smith observes, make a point of being indem¬ nified, not only for whatsoever extraordinary risk it is that he runs, independently of the law, but for the very risk occasioned by the law : he must be insured , as it were, against the law. This cause would operate were there even as many persons ready to lend upon the illegal rate as upon the legal. But this is not the case, a great number of persons are, of course, driven out of this competition by the danger of the business ; and another great number by the disrepute which, under cover 180 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. of these prohibitory laws, has fastened itself upon the name of usurer. So many persons, therefore, being driven out of the trade, it happens in this branch, as it must in every other, that those who remain have the less to withhold them from advan¬ cing their terms ; and without confederating, each one will find it easier to push his advantage up to any given degree of ex¬ orbitancy, than he would, if his rapacity were checked by a more general competition. Through the whole course of the foregoing argument, I have proceeded on the supposition that Anti-usurious Laws, al¬ though in particular instances open to evasion, may yet be so framed as to accomplish to a certain degree those restraints on pecuniary bargains which the legislator wishes to impose. There is, however, in Mr. Smith’s Wealth of Nations, a pas¬ sage in which he asserts (by implication at least) the contrary ; a passage the more extraordinary in this eminent writer, that, if it were true, it would prove those laws, of which he has ex¬ pressed his approbation, to be completely nugatory. “No law,” says he, “ can reduce the common rate of interest below the lowest ordinarv market rate at the time when that law was made. Notwithstanding the edict of 1766, by which the French King attempted to reduce the rate of interest from five to four per cent., money continued to be lent in France at five per cent., the law being evaded in several different ways.”* It is remarkable, that of this position, expressed in the most general and unqualified terms, (and which is certainly very far from being self-evident,) no proof whatever is produced by Mr. Smith, but one particular instance ; an instance which proves nothing but the inefficacy of one particular law, which might have been owing to an accidental defect in its structure, or in the provisions made for carrying it into execution. What is more, the position does not seem to be true in the extent in which it is stated. At least, if it is true, that “ no law can reduce the common rate of interest below the lowest ordinary market rate at the time when that law wTas made,” the same combination of circumstances must afford obstacles equally * [Boole II. chap. iv. ; Yol. II. p. 45, tenth edition.] 181 CHAP. III. — OF TRADE. (§ 3.) powerful to the efficacy of the law against all higher rates ; and for this purpose nothing can he effectual but a resolution on the parts of all persons any way privy not to inform. Suppos¬ ing this to be the case, all rates of interest would be equally free, and the state of men’s dealings in this way just what it would be were there no law at all on the subject. That this is not the case in England, is manifest from the examples which every now and then occur, of convictions upon the statutes against usury. In other parts of Europe where Anti-usurious Laws are established, there is probably, in this respect, a differ¬ ence of degree, according as the case of the legislator has been more or less employed in rendering the laws effectual. In one country, the empire of Russia, the whole system of laws on this article is said to be merely a dead letter. “ The rate fixed by law in Russia,” says Mr. Bentham, “ is five per cent. ; but although many persons in that country borrow money, none borrow it at the legal rate. The lowest ordinary rate upon the very best real security, is eight per cent. ; nine, and even ten, upon such security are common. Six or seven may have place, now and then, between relations or other particular friends ; because now and then a man may make a present of one or two per cent, to a person whom he means to favour. The contract is renewed from year to year ; for a thousand roubles, the borrower in his written contract obliges himself to pay at the end of the year one thousand and fifty. Before witnesses he receives his thousand roubles ; and without witnesses he immediately pays back his thirty roubles, or his forty roubles, or whatever the sum may be, that is necessary to bring the real rate of interest to the rate verbally agreed on.”* I have already said, that in England the Anti-usurious Laws are confessedly of very considerable efficacy in restraining the terms of pecuniary bargains. Even in England, however, the law is very far from being consistent with itself, inasmuch as it sanctions virtual usury in a variety of cases ; and therefore if it were guided by any general principle upon this subject, it ought either to guard against these indirect violations of its * [ Defence of Usury , Letter vii. ; Works, Vol. III. p. 12 ] 182 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. own general spirit, or leave the commerce of money entirely open. One of the most obvious instances in which virtual usury is permitted by law, is in a practice well known among merchants by the name of drawing and re-drawing. The nature of this operation is very distinctly and fully explained by Mr. Smith in the second chapter of the Second Book of his Wealth of Nations. From the account of it which he gives, it is obvious in what way by means of it money may be obtained, and in fact has very often been obtained by merchants at an interest more than double of that permitted by law. The extra interest is in this case marked under the names of commission and price of exchange. The commission is but small on each draft, (never less, however, than one-half per cent.,) but by a frequent repetition of the operation during the course of the year, it may swell the rate of interest to eight or ten per cent., or even con¬ siderably higher. By means of this expedient, therefore, the Anti-usurious Laws may be eluded, though by a process some¬ what complicated and troublesome ; and it is evident where this is had recourse to, it renders the business of borrowing money much more ruinous to the merchant than any bargain he could well be supposed to have made with money-lenders, had the commerce of money been perfectly free. The monopoly of this virtual usury is secured to bankers, and the profits they derive from it must consequently be higher than if a general competition in the trade of money-lending were allowed to capitalists of every description. Beside this expedient for raising money at an usurious rate, (which may be thought to be rather tolerated and overlooked than sanctioned by law,) there are others which have at all times been in use under its immediate countenance and authority. The first I shall mention is, by having recourse to pawn¬ brokers. In this case, the law by regulating , avowedly pro¬ tects usury, and actually authorizes a very high rate of interest as a compensation for the expense of warehouseroom, and that of insurance against fire and other accidents. Nor is there 183 ;CHAP. III. — OF TRADE. (§ 3.) much reason for believing that the limits prescribed by law are here of any considerable efficacy. On the contrary, it is pre¬ sumable that the profits of the trade are, like those of other trades, determined chiefly by the competition amongst the traders. The indulgence given by our law to pawnbrokers has, no doubt, proceeded from a sense of their absolute necessity in such a state of society as ours, particularly in great and over¬ grown towns. In a city, for example, like London, there are vast multitudes who have no friend to aid them in distress ; who live from day to day, or from week to week, without realizing any stock for a season of adversity. When such a man falls sick, the whole revenue of a poor family is stopped at once. If he would borrow, his personal security depends on his recovery, and on his being able by future industry to pay the debt by what he can save over and above the maintenance of his family. In such a situation, his only resource is evi¬ dently to sell some part of his furniture, or to pledge it with a pawnbroker ; and without this resource, thousands who gra¬ dually recover their credit, would be driven at once to ruin and beggary. The trade of a pawnbroker, it must, notwithstanding, be confessed, lays a man under great temptation to deal hardly with the poor ; and it is highly expedient that severe penalties should be held out against those who exercise it oppressively and cruelly. The humanity of our own Legislature in this respect must not be passed over in silence. Within the last ten years, several very important regulations have been made, not only with a view of limiting the rates of money lent on pledges, but (what is of far greater consequence) to prevent the unfortunate from being obliged to part with their property without a fair consideration, — imposing, at the same time, severe penalties on those who avail themselves of the means which such shops are calculated to afford, to commit depreda¬ tions on the property of others.1 For the attainment, how¬ ever, of the ends which our legislators have had so laudably 1 Eden, On the Poor, Vol. f- p. 300. 184 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. in view, there is ground to believe that much yet remains to be done. The author of the Treatise on the Police of the Metropolis* lately published, remarks, that a class of sharpers obtain licenses to become pawnbrokers. He observes, that “ any person, even the most notorious rogue or vagabond, who can raise ten pounds to pay a license, may, at present, set up the trade of a pawnbroker ; and it is even said, that some have got licenses who have actually been on board the Hulks. This class of swindling pawnbrokers,” he says, u are uniformly receivers of stolen goods, and under the cover of their license do much mischief to the public, which might be prevented, in a great measure, by placing the power of granting licenses in the hands of the Magistrates of the Division, upon the footing of public-houses, and rendering it necessary for all persons to obtain a certificate of character before they can obtain such license, and also to enter into a recognizance of good be¬ haviour.” | The same author states the number of pawnbrokers within the bills of mortality, paying a license of £10 a year, at 213 ; and of pawnbrokers in the country, paying £5 a year, at 431, — in all, 644. He adds, that the property of the poorest and most distressed part of the community, to the amount of more than half a million sterling, is constantly in the hands of pawnbrokers in the metropolis alone. This, too, seems a very moderate statement. Sir Frederick Eden tells us, that he was present, three or four years ago, at the trial of a pawn¬ broker, at Hewcastle-upon-Tyne, for receiving stolen goods, when it appeared that above 30,000 pawns went through his hands in a year. I have already said that, in a great metropolis like London, the trade of a pawnbroker, under proper regulations, seems to be a necessary evil ; and I have hinted my doubts whether it is of much use for law to interpose in fixing limits to the rate of interest. It is here, however, where our laws have relaxed from their usual severity against usurers, that the most specious apology might be made for their rigorous application, — inas- * [Peter Colquhoun, LL.D.] f [Chap. v. p. 116, seventh edition.] CHAP. III. — OF TRADE. (§ 3.) 185 much as the security is, in this case, not only equal to, but better than what it can be in any other, consisting in the present possession of a moveable article, of easy sale, on which the creditor has the power, and certainly does not want the inclination, to set such price as is most for his advantage. Even in such cases, however, the interposition of law in favour of the indigent, would probably only aggravate the evil it meant to cure.* (Accordingly, Dr. Reid, in an Essay on this subject, formerly referred to, [supra, p. 157,] in which he argues for the perfect freedom of pecuniary bargains in all cases where the parties are upon an equal footing, and where the borrower cannot be said to be pressed by any necessity, yet pleads for an exception in every instance in which the borrower is compelled to apply to a money-lender by indigence. “ If the Law/' says he, “ could distinguish between the poor and the rich, — between those who borrow from hard necessity, to prevent going to prison, or having their goods carried off by legal execution, and those who borrow to extend their trade and increase their profit ; — if this were possible, I heartily agree that, with regard to the first of these cases, the law should fix the highest rate of interest that can be taken, and that the law should be enforced under the severest penalties, such as our present laws inflict on usurers/' He grants, at the same time, the difficulty of distinguishing by a law the poor from the rich, and contents himself with submitting, as the best criterion he can suggest for the purpose, that all those shall be considered as entitled to the protection of law who borrow upon a pledge. A man does not borrow in this way who can give good personal security; and he who cannot give good personal security for what he must borrow, may be considered as in necessity. “ It seems reasonable, therefore," according to Dr. Reid, ce that such laws as we at present have, should take place against pawnbrokers ; and it is the more reasonable, as the pawnbroker has absolute security from his debtor having a pledge in his hand." I have already given my reasons for thinking, that * [The last sentence inserted , and the following passage within lound biackets, left out in the last correction.] 186 POLITICAL ECONOMY. - PART I. — BOOK II. — NAT. WEALTH. even in the case of indigence, all these well-meant interposi¬ tions of law in limiting the rate of interest, only aggravate the evil which they propose to cure.) Another case in which the usurious rate of interest is sanc¬ tioned by law, is that of Bottomry and Respondentia. In a contract of the former kind, the lender advances money to the owner of a ship, who pledges his property in it as security, en¬ gaging to repay the money, with a stipulated consideration for risk and advance, when the ship returns ; — it being understood, on the other hand, that if the ship be lost, the lender is to lose his money. Respondentia contracts are of the same nature, differing only in this, that the security is on goods instead of the ship ; which goods being necessarily sold or exchanged in the course of the voyage, and the ship not being pledged, the person of the borrower is alone responsible for the money lent ; and hence he is said to take up money at respondentia. The condition of repayment is, that the goods do not perish through the dangers of the sea.1 These terms are also applied to contracts for the repayment of money borrowed, not on the ship and goods only, but on the mere hazard of the voyage itself, which kind of agreement is sometimes called foenus nau- ticum , and sometimes usura maritima. But as this gave an opening for usurious and gaming contracts, especially on long voyages, it was enacted, 19th Geo. II. c. 37, that all moneys lent on bottomry or at respondentia , or vessels bound to or from the East Indies , shall be expressly lent on ships or goods ; and that if the borrower has not an interest in the ship, or in the effects on board, equal to the value of the sum borrowed, he shall be responsible to the lender for so much of the principal as has not been laid out, with legal interest and all other charges, though the ship and merchandise be totally lost.'"2 In contracts of bottomry and respondentia, (including under this title the foenus nauticum ,) the law authorizes a departure from the established regulations with respect to interest ; ac¬ knowledging, in such instances, the reasonableness of a compen¬ sation for risk, as well as for the use of the money borrowed, 1 Hamilton’s Merchandise, p. 537. 2 Blackstvnc, Vol. II. p. 458. CHAP. III.* — OF TEADE. (§ 3.) 187 and leaving the particular terms of the bargain to be adjusted by the parties, according to the market rate of interest, and the rate of insurance.1 I took notice in my last lecture [supra, p. 152, seqi] of a most extraordinary fact mentioned by Sir William Jones, that cc in the first of the Sacred Law Tracts’ ’ supposed to he revealed by Menu some millions of years ago, and which Sir William Jones him¬ self refers to a date long prior to the Christian era, “ there is a general regulation limiting the rate of interest in ordinary cases, with an express exception in regard to adventures at sea. This exception (as Sir William Jones observes) the sense of mankind approves, and commerce absolutely requires, though it was not before the reign of Charles I. that our English Juris¬ prudence fully admitted it in respect of maritime contracts/' The truth is, that the existence of the exception in this very ancient code, is less wonderful than that of the general rule ; more particularly when we consider that the rule appears to have maintained its ground, as it also had done in modern Europe, after the unsoundness of its principle had been thus explicitly acknowledged. Such coincidences among distant ages and nations in their prejudices and inconsistencies, are still more wonderful than in institutions recommended by reason and justice ; and incomparably more so, than any accidental repeti¬ tions of discoveries in the exacter sciences. The same inconsistency may be remarked in those laws 1 With respect to the principles of the Civil Law concerning the fcenus nau- ticum , the annotations of Henry de C'occeii on Chapter xii. Book ii. of Gro- tius, De Jure Belli , &c., are worthy of a perusal. See likewise Lampredi. In general, it appears, that the code of Justinian, while it confined persons of illustrious rank to the moderate profits of four per cent., and pronounced six to be the ordinary and legal rate of inter¬ est, allowed eigld for the convenience of manufacturers and merchants, and twelve (or usurer centesimce ) in the case of loans risked on the hazardous issue of nautical adventures. With respect to modern nations, the fact is thus stated by Lampredi : — “ Con- suetudine et moribus invaluit, ubivis gentium , ut jus antiquum revocaretur, et in Bodemeria ,” (a word of German origin, corresponding to our term bot¬ tomry,) “ ceterisque negotiis maritimis periculi pretium nullis esset limitibus circumscriptum, atque adeo usura etiam plusquam centesima in pactum deduci licite posset.” — Vol. T. p. 414. 188 POLITICAL ECONOMY.— -PART I. — BOOK II. — NAT. WEALTH. which grant an unlimited license to all the different kinds of insurance ; to the purchase and sale of annuities ; and, in a word, to every case where a man is permitted to take upon him¬ self an unlimited degree of risk, receiving for so doing an un¬ limited compensation. Mr. Erskine, in his Institutes of the Law of Scotland* says, “ where a creditor's right to interest is clogged with an uncertain condition, by which he runs the hazard of losing his whole debt, if the condition should never exist, he may stipulate for a higher interest than the legal, without the crime of usury ; for there the interest is not given, merely in con¬ sideration of the use of the money, but of the risk also under¬ taken by the creditor." And to the same purpose Mr. Christian, “ It is an established rule, that no contract is within the statute of usury, although more than five per cent, is to be paid on money advanced, if the principal is actually put in hazard, and may be totally lost to the lender."1 In all these instances the law grants a liberty perfectly just and highly expedient, but altogether inconsistent with the general principles which, in a commercial country, limit pecuniary bargains to certain fixed conditions. The remarks which have now been made, afford a very strong confirmation of the reasonings already offered, to shew the in¬ expediency of a legal rate of interest. They prove that while such a restraint is perfectly efficacious in aggravating the dis¬ tresses of those whom it professes to protect, it never can be so contrived as to accommodate the commercial transactions of a country to the arbitary views of the legislator. The natural course of trade is too powerful to be controlled by laws which are at variance with the interests of private parties, and with the general state of society. And all that law can in such cases effect, is to force individuals on those indirect modes of evasion, which accomplish the end in a more circuitous and expensive way for themselves, as well as more prejudicial to the interests of the public. The same remarks also shew, that the general position formerly quoted [supra, p. 180] from Mr. * [Book IV. Title iv. § 76.] 1 [Edition of Blackst one's Commentaries l\ Vol. II. p. 458. CHAP. III. — OF TRADE. (§ 3.) 189 Smith, to wit, that “ no law can reduce the common rate of interest below the lowest ordinary market rate at the time when that law was made/’ although by no means true in the unqualified form in which he has stated it, is yet a most just and important maxim, when received under proper limitations. To the same purpose also, Mr. Locke long ago remarked, that “ it is in vain to go about effectually to reduce the price of interest by a law ; and you may as rationally expect to set a fixed rate upon the hire of houses, or of ships, as of money. He that wants a vessel, rather than lose his market, will not stick to have it at the market rate, and find ways to do it with security to the owner, though the rate were limited by law ; and he that wants money rather than lose his voyage or his trade, will pay the natural interest for it, and submit to such ways of conveyance as shall, keep the lender out of reach of the law. So that your Act at best will serve only to increase the arts of lending, but not at all lessen the charge of the borrower, who, it is likely, shall, with more trouble, and going farther about, pay also the more for his money.”1 How nugatory, therefore, are those plans which speculative politicians have so often held out for advancing national wealth and prosperity by reducing the rate of interest to a still lower standard ! In the last century this was a favourite object with Sir Josiah Child, who recommended such a measure as “ an effectual expedient for advancing the price of lands in the purchase, for improving the rent of farms, for employing the poor, for multiplying artificers, for increasing foreign trade, and for augmenting the stocks of merchants.” Nor does the inefficacy of this project appear to be yet universally admitted. A late respectable writer, Hr. Crumpe, after giving the sanction of his approba¬ tion to the reasonings of Child, recommends the lowering ot the legal rate of interest in Ireland, as the most likely means of promoting the manufactures of that country, and consequently the employment of the people.2 An author, too, ol still higher 1 Vol. IT. p. 6. — [First Considerations arguments on the other side ot the of Interest and Money.] question. 2 P. 340. — Mem : — To consult Locke’s 190 POLITICAL ECONOMY. — PART I. — BOOK I!. — NAT. WEALTH. name, the Marquis Beccaria, in a Discourse on Public Economy of Commerce, published about the year 1769, in enumerating the principal means by which a government may promote trade, mentions expressly the low interest of money.1 The cir¬ cumstance which has misled all these writers has evidently been, that inseparable connexion which was before fully illus¬ trated between a flourishing commerce and a low rate of in¬ terest. As the latter of these results naturally and necessarily follows from the former, they were led to imagine, that if the effect could only be secured by the direct interposition of law, it would draw along with it, as consequences, all those happy concomitants or causes with which they had found it connected in the course of their observations. Having mentioned Locke’s Treatise on Interest , (which was written in opposition to Child,) I cannot help observing, that although he declares in favour of a legal rate of interest,2 yet all his reasonings lead to an opposite conclusion. And, indeed, the arguments he alleges in favour of a legal rate are so trifling, and so slightly urged, that he was probably prevented, merely by a respect for established opinions, from pushing his conclu¬ sion to its full extent. The passage deserves to be quoted in his own words : — “ It is necessary that there should be a stated rate of in¬ terest, and in debts and forbearances, where contract has not settled it between the parties, the law might give a rule, and courts of judicature might know what damages to allow. This may, and therefore should, be regulated. “ That in the present current of running cash, which now takes its course almost all to London, and is engrossed by a very few hands in comparison, young men, and those in want, might not too easily be exposed to extortion and oppression, and the dexterous and combining money-jobbers not have too great and unbounded a power to prey upon the ignorance or necessity of borrowers. There would not be much danger of this if money were more equally distributed into the several 1 Monthly Review, Yol. XLI. p. 176. 2 Yol. II. p. 31. — [First Considerations of Interest and Money.] CHAP. III. — OF TRADE. (§ 3.) 191 quarters of England, and into a greater number of hands, according to the exigencies of trade. “ If money were to be hired as land is, or to be had, as corn or wool, from the owner himself, and known good security be given for it, it might then, probably, be had at the market (which is the true) rate, and that rate of interest would be a constant gauge of your trade and wealth. But, when a kind of monopoly, by consent, has put this general commodity into a few hands, it may need regulation, though what the stated rate of interest should be, in the constant change of affairs and flux of money, is hard to determine. Possibly, it may be allowed, as a reasonable proposal, that it should be within such bounds as should not, on the one side, quite eat up the merchant’s and tradesmen’s profit and discourage their industry ; nor, on the other hand, so low, as should hinder men from risking their money in other men’s hands, and so rather choose to keep it out of trade, than venture it upon so small a profit. When it is too high, it so hinders the merchant’s gain that he will not borrow ; when too low, it so hinders the monied man’s profit that he will not lend ; and in both these ways it is an hindrance to trade.” In stating these observations, I would, by no means, be under¬ stood to deny, that low interest is a cause as well as an effect of National Wealth, or that it ought to be an object with a statesman to favour as much as possible its reduction, by the general plan of his policy. I only speak of the inefficacy of particular regulations to that purpose, unless they are so accommodated to the actual circumstances of a country that the same consequences would spontaneously have taken place in the natural course of things, without the interposition of the legislator. The importance of low interest to the progress of National Wealth follows, as an obvious consequence, from the remarks formerly made on the accumulation of stock. a The proprietor, ’ says Turgot, a who lends money, ought to be considered as a dealer in a commodity absolutely necessary for the production of riches, and which cannot be at too low a price. To charge 192 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. this commerce, therefore, with duties, would be as unreason¬ able as to lay a duty on a dung-hill, which is to manure the land.”* The truth is, that a decrease in the market rate of interest (so far as it is in the power of laws to favour it, by their general spirit and tendency) is the only safe and effectual encouragement which a statesman can give to national industry. It will afterwards appear, that the regulations of commerce, which have been commonly employed for that purpose, (such as prohibitions, monopolies, bounties, drawbacks, &c.,) are not merely useless, but positively hurtful. They may , indeed, encourage particular branches of industry, but it is at the expense of other branches, from which they withdraw their natural share of the capital of the country. Nor do they al¬ ways succeed in advancing even those trades which they favour, inasmuch as by multiplying their productions beyond their due proportion, they must, in some instances, have the effect of overstocking the market. Hence the only equitable and ad¬ vantageous encouragements to industry are those which favour all its branches alike ; and such, precisely, is the effect of a low rate of interest .’n It enables individuals with the same given resources, to put larger capitals in motion, leaving them, in the employment of their capitals, entirely to the guidance of their own prudential views of profit, and extending to all equally the means of applying their industry to their favourite objects. Among the other mischievous effects of raising supplies on the funding system, its tendency to increase the market rate of interest is one of the most important. Immense sums, which would otherwise have been employed in the various depart¬ ments of useful industry, are kept disengaged for speculations in the funds ; and a shock is frequently given to the trade and manufactures of the kingdom by a sudden abstraction of capital, in consequence of those high temptations to lenders which it is necessary for Government to hold out in times of difficulty. * [ Reflexions sur la Formation et la 1 Gale’s Second Essay on Public Distribution des Fichesses, § xcv. Credit. (Euvres, Vol. V. p. 123.] CHAP. HI. - OF TRADE. (§ 3.) 193 It is, however, chiefly against the agricultural improvement of the country that public loans operate. The high profits of trade enable persons of good credit to elude the laws against usury, by expedients which custom authorizes, and which actual circumstances render absolutely necessary. The short¬ ness of the period too, to which their temporary accommodations generally extend, while it enhances the rate of interest, leaves the money-lender at all times the ready command of his capital. The case is widely different with those who have occasion to borrow money for agricultural speculations, which afford but moderate profits, and which, from their slow returns, require loans of a more permanent nature. This is felt severely in the present times, even by those who have landed security to offer, and who, accordingly, are frequently reduced to the ruinous resource of raising money on annuities ; consequences, undoubtedly, of the most alarming sort to the country in gene¬ ral, but which necessarily result from the high rate of interest obtainable upon government securities. Although, therefore, it seems to be impossible for a states¬ man, by an arbitrary reduction of the legal rate of interest, to accelerate the national prosperity at pleasure, it is equally clear, on the other hand, that the general plan of its policy may influence, to a great degree, this essential requisite to improvement. How much the inconveniences, which have just been men¬ tioned as resulting from public loans, are aggravated by the Anti-usurious Laws, is sufficiently evident. The tendency of such restraints on the commerce of money being obviously to raise the rate of interest in the market. M. Turgot has made some good observations on this point, in his Essay on Money Loans , formerly referred to, [supra, p. 157.] I shall conclude this subject with remarking, that the pre¬ judices and laws with respect to Compound Interest are entirely of a piece with those which have been now under our conside¬ ration, originating in the same idea, that the protection of the borrower requires the interposition of the legislator, in every instance, in a greater degree than that of the lender. VOL. ix. N 194 POLITICAL ECONOMY.— PART 1. — BOOK II. — NAT. WEALTH. It appears from an Epistle of Cicero to Atticus, that com¬ pound interest was not then, in every case, contrary to law ; for he says, that usurce centesimce cum anatocismo anniversario might be enacted.1 But this law was abrogated by Justinian ;2 and in modern Europe compound interest is almost universally reprobated as the worst species of usury and extortion. In reason and equity, however, there seems to be no foundation for this opinion ; the same principles which justify simple interest, concluding decisively in favour of compound interest, when the principal is withheld after being demanded ; and, accordingly, Henry de Cocceii pronounced, long ago, that u surge usurarum , or anatocismus , is perfectly agreeable to the laic of nature. “Jure naturge usuras usurarum semper deberi, puto, etsi promissce non fuerint. Is enim qui mea pecunia utitur, ae pro eo usu annuas usuras promittit, nec solvit has ipsas usuras, plus suo liabet ; utitur jure alieno ; mihi aliquid abest, unde lucrum caper e possem si debitor usuras solvisset : adeoque ex natura obligations sequitur, gestimationem ejus, quod facto debitoris mihi abest, id est, usuras usurarum, solvi debereJ3 The argument, however, is stated much more forcibly by Mr. Bentham, who has allotted a separate section of his Treatise to the discussion of this very question. The substance of his reasoning may be collected from the following abstract : — “ If the borrower pays his interest at the day, and thereby performs his engagement with punctuality, the lender has it in his power to secure compound interest, by lending it out again immediately. If he fails of receiving it, he is by so much a loser. The borrower, by paying it at the day, is no loser ; if he does not pay it at the day he ;s by so much a gainer ; and what is wrorse, the gain which the law in its ten¬ derness thus bestows on him, is a reward which it holds out in many cases for breach of faith, for indolence, and for negli¬ gence. The loss, on the other hand, which it thus throws on 1 Lib. Y. Epist. ult. 3 [IT. Cocceii ad] Grotium, De Jure 2 See Grotius, Lampredi, and TI. Belli, &c., Lib. II. cap. xii. £ 22. [Edit. Cocceii. Lausanne, 1751, Tom. II. p. 721.] CHAP. III. — OF TRADE. (§ 4.) 195 the forbearing lender, is a punishment which it inflicts on him for his forbearance ; while the power which it gives him of avoiding that loss, by prosecuting the borrower upon the instant of failure, is a reward which it holds out to him for his lmrd- heartedness and rigour. ee It may indeed be, in many cases, impossible for the borrower to pay the interest at the day ; but what is the obvious in¬ ference ? That the creditor should not have it in his power to ruin the debtor for not paying at the day, and that he should receive a compensation for the loss occasioned by such failure. The spirit of our existing laws is precisely the reverse of this. The creditor has it in his power to ruin him, and he has it not in his power to obtain such a compensation. On the contrary, if the debtor has recourse to law, and resolves to fight his creditor through all the windings of mischievous delay, he purchases a respite at ten times, perhaps at a hundred times, the expense of compound interest ; while, of the money thus thrown away, no part falls to the share of the individual he has injured, but is consumed by the legal agents who conduct the litigation.”* [sect. IV. — ON SUBJECTING THE COMMERCE OF LAND TO THE REGULATION OF LAW.] ( Interpolation from Notes.) — I proceed next, agreeably to the arrangement formerly laid down, [. Political Economy , Vol. I. p. 45,] to make some remarks on the expediency of restraints on the Commerce of Land. The pre-eminent importance of landed property, and the various effects connected with its distribution, will justify me sufficiently for treating of it separately from the other consti¬ tuents of National Wealth. From the observations which I formerly had occasion to make, it appears how intimately this subject is connected with the advancement ol that species of wealth which gives existence to all the others, furnishing to the various classes of manufacturers and artists, both the mate- * [ Defence of Usury, Letter xi. ; Works , A el. III. p. IS.] 196 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. rials of their subsistence, and the rude materials on which their industry is employed. “ II faut cependant observer/' to borrow the words of a French writer, u que le laboureur fournissant a tons fobjet le plus important et le plus considerable de leur consommation, (je veux dire leurs aliments, et de plus la ma- tiere de presque tous les ouvrages,) a Tavantage d’une plus grande independance. Son travail, dans l'ordre des travaux partages entre les differents membres de la Societe, conserve la meme primaute, la meme pre-eminence quavait, entre les dif¬ ferents travaux qu’il etait oblige dans l'etat solitaire de consacrer a ses besoins de toute espece, le travail qui subvenait a sa nour- riture. Ce n'est pas ici une primaute d'honneur ou de dignite ; elle est de necessite physique. Le laboureur peut absolument parlant se passer du travail des autres ouvriers, jmais aucun ouvrier ne peut travailler si le laboureur ne le fait vivre.”* This general proposition I endeavoured to illustrate in a former part of my course.*)* The remarks which I have now to offer, relate entirely to the policy of different nations, with respect to the distribution and commerce of landed property. In the codes of the ancient legislators, one of the leading objects of attention appears to have been to secure as great an equality as possible in the appropriation of lands, by establish¬ ing various expedients to obviate the effect of those circum¬ stances which have a tendency to disturb this equality. — For this purpose, Moses prohibited the perpetual alienation of landed property, and ordered that every fiftieth year, the land which had been sold during the preceding period should return to the former proprietor or his family 4 — In the laws of the Athenians, we meet with a variety of provisions, plainly proceeding from the same views as influenced the Jewish legislator. Such were those which restricted the citizens in the power of making testaments, — those which established an equal division of property among the male children, — those which put it out of the power of the same person to succeed to two * [Turgot, Sur la Formation et la f [Supra, Political Economy, Yol. I. Distribution des Riches ses, § v.; CEuvres, [Works, Yol. VIII.) p. 258, seqi] lom. V. p. 6.] | [ Leviticus , xxv. 10.] CHAP. III. 197 — OF TRADE. (§ 4.) inheritances,— and many other regulations of a similar nature. On the subject of the laws of succession among the Greeks, a great deal of most important light has been thrown by Sir William Jones, in the Commentary annexed to his Translation of the Speeches of Isceus. Among the ancient Germans, according to a passage in Tacitus, there appear to have been some regulations which tended to accomplish the same object, by a process still more simple and direct. The nation was considered as the proprietor of all the lands, which individuals held for a time ; and at the end of each year, a new distribution of land was made, accord¬ ing to the varying circumstances of the population* It is remarkable, as Mr. Hume observes in his History of England, that “ among the Irish, as far down as the seventeenth century, land was divided in a similar way. If any of the sept died, his portion was not shared out among his sons, but the chieftain, at his discretion, made a new partition of all the lands belong¬ ing to that sept, and gave every one his share/’ f The earliest laws of the Homans deserve attention in the same point of view. By an examination of these, it is evident that their leading idea was to prevent the original number of proprietors from being diminished. This was more particularly the case with their laws relating to the succession of females, which have been very ingeniously illustrated by Montesquieu, p In modern times, the state of society which arose in Europe after the subversion of the western empire, gave rise to a very opposite policy, by suggesting as a necessary expedient against the rudeness and violence of the time, two institutions, which have both had a most extensive influence, not only on the dis¬ tribution of land, but on the whole system of modern manners. These are the right of Primogeniture and the practice of Entails . That a certain preference should be given by a parent to his first-born, who, in the order of nature, is marked out as the protector and guardian of his younger children, is so agieeable to the most obvious suggestions of the mind, that it is not sui- | [Esprit des Loix, Liv. xxvii. Partie II. p. 167, ed. Geneve, 1749.) * [Germania, cap. xxvi.] f [Chap. xlvi. .Tames I ] 198 POLITICAL ECONOMY. — PART I. — BOOK II. - NAT. WEALTH. prising we should find traces of it in the history of the earliest ages. In the accounts of the primitive times, given in the Sacred Writings, the influence of the prerogative that has always been attached to seniority, is strongly illustrated by the stories of Jacob and Esau, and of Leah and Rachel. The same pre¬ ference, too, occurs in the Pagan mythology, where, in conse¬ quence of this very circumstance, J upiter is invested with the supremacy. This preference, however, does not seem to have existed among the Greeks, Romans, Britons, and Saxons, all of whom divided the land indiscriminately among the children. At Athens, the sons succeeded equally ; but the daughters were endowed by their brothers. What share of the inherit¬ ance was allotted to the daughters, or whether it was regulated by any fixed rule, does not appear. Sir William Jones, in the learned Commentary mentioned above, thinks that this was left entirely to the affection and liberality of the brothers. By the Roman law, all the children, both male and female, were called equally to the inheritance of their father’s possessions. From the custom of Gavelkind in Kent, which divides the land equally among all the sons, Selclen concludes, that this was the general custom of the realm before the Norman Con¬ quest, retained in this district, in consequence of the successful struggle which was made by the inhabitants to preserve their ancient liberties. The same opinion, also, is sanctioned by Sir William Blackstone.* Spelman, in his Glossary , under the word Gaveletum ( Gavelkind ,) refers the origin of this custom to Germany. i( Prisca Anglo-Saxonum consuetudo e Germania delata, qua omnes filii ex gequis portionibus, patris adeunt liEereditatem ; (ut hike solent, prole mascula deficiente.) Fratres similiter, defuncto sine sobole fratre; et nullo existente fratre, sorores pariter.” But it appears to be somewhat doubtful what the rules of succession in Germany really were. Mr. Barrington, in his Observations on the Statutes , with many others, follows on this point the opinion of Spelman, relying entirely on the following passage of Tacitus, which certainly does not warrant any such conclusion : — “ Hteredes tamen successoresque sui * [Treatise on the Law of Descents: Law Tracts, Vo 1. II. pp. 189-248, orig. edit,] 199 CHAP. III. — OF TRADE. (§4.) cuique liberi : et nullum testament um. Si liberi non sunt, proximus gradus in possessione fratres, patrui, avunculi. Quanto plus propinquorum, quo major adfinium numerus, tanto gra- tiosior senectus : nec ulla orbitatis pretia.”* It is not here said that the property was divided equally among the children, nor does it contain one expression at all inconsistent with the sup¬ position, that the children first succeeded singly and in the course of their ages, in defect of these, the brothers, and on their failure, the uncles. On the other hand, another passage from Tacitus is quoted by Dr, Gilbert Stuart, f in proof of the right of primogeniture among them, which it seems to me impossible to explain away: — Ci Inter familiara, et penates, et jura succes- sionum, equi traduntur : excipit filius, non, ut cetera , maximus natu , sed prout ferox hello et melior.” This testimony in favour of the eldest son, Dr. Stuart remarks, is the more strong, as being included in an exception to the general rule. But whatever may have been the origin of the law of gavel¬ kind, there cannot well be any diversity of opinion about its expediency as a political institution, more particularly when it is considered in connexion with that system of Political Economy which has been dictated by the circumstances of modern Europe. Of this, indeed, no proof more striking can be pro¬ duced than the prosperous state of agriculture in the county where it still exists, — an effect which, as I mentioned formerly, [Yol. I. p. 168,] Mr. Arthur Young seems disposed to ascribe to the want of manufactures. The following information on this point, stated by Mr. Marshall in his Rural Economy of the Southern Counties , is extremely interesting and valuable: — ■ u In the district of Maidstone, even among the tenantry, are found men of wealth and respectability ; qualities for which the yeomanry of Kent have long been proverbial. “ Out of the Law of Gavelkind, this valuable order of men have principally risen. And seeing the present flourishing state of their county, after seven hundred years of experience, the wisdom of that law appears in a strong light. For although rities, Book T. chap. ii. sect. ii. p. 220, edit. 1778.1 * [ Germania , cap. xx.] t [ View of Society in Europe ; Audio 200 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. it has furnished the county with its present high state of society, with respect to the middle classes, it has not done away the gradations of rank, which appear to he necessary in every organized society/'* Its moral tendency is illustrated by an anecdote mentioned by the same writer : — ec Some years ago, in the district of Maid¬ stone, a person, who died possessed of considerable property, left live sons, and a will, in which partiality to individuals was, of course, expected. Nevertheless, the brothers, harmonized by the influence of equal law , agreed, before the will was broken open, to inherit according to the natural law of their county ; and the will was burnt with the seal unbroken. u The operation of this equitable law in the instance under notice, has been highly favourable to society, which has thereby gained live wealthy, respectable, 'productive members, — yeomen of the higher class. Whereas, had the whole property devolved on one of them, even this one, probably, would have been rendered unprofitable to society, while the rest must have been thrown upon the world, to scramble for property in trade or the professions/' f Another mode of succession, of which some traces still remain in England, is worthy of notice, as a yet more striking contrast to those ideas with which we have been familiarized by the prevailing laws and manners of modern Europe ; I mean the custom of Borough-English , according to which the youngest son, and not the eldest, succeeds to socage tenements on the death of his father. Blackstone's suggestion concerning the origin of this custom is not entirely destitute of probability. <£ Perhaps a more rational account may be fetched (though at a sufficient distance) from the practice of the Tartars, among whom, according to Father Duhalde, this custom of descent to the youngest son also prevails. That nation is composed totally of shepherds and herdsmen ; and the elder sons, as soon as they are capable of leading a pastoral life, migrate from their father with a certain allotment of cattle, and go to seek a new habita- * [District of Maidstone, Division HI. § ii . ; Yol. T. pp. 53, 54, edit. 1798.] f [Ibid. pp. 54, 55.] CHAP. III. — OF TRADE. (§4.) 201 tion. The youngest son, therefore, who continues latest with the father, is naturally the heir of his house, the rest being already provided for. And thus we find that, among many other northern nations, it was the custom for all the sons but one to migrate from the father, which one became his heir. So that possibly this custom, wherever it prevails, may be the remnant of that pastoral state of our British and German ancestors, which Cmsar and Tacitus describe.”* What the circumstances were which first introduced the Law of Primogeniture in modern Europe, has been explained with great ingenuity by Mr. Smith in his Wealth of Nations.^ The obstacles which this institution opposes to the improve¬ ment of agriculture, have been so ably and distinctly pointed out by the same author, that I shall not here enter into the dis¬ cussion. It is necessary that our speculations should apply as much as possible to the actual circumstances of the world, without regard to any ideal improvements of which they are susceptible. I cannot help, however, remarking, how much these restraints have a tendency to complicate the science of Political Economy, when studied with reference to our present situation. In truth, these are of infinitely greater moment than any restraints on the freedom of trade can possibly be ; and while they exclude a variety of the general principles of the science from having an application to our present cir¬ cumstances, others must, in consequence of their influence, as I apprehend, be admitted with great limitations. Some questions, too, of a very intricate nature, derive their origin entirely from the inconveniences which result from these dis¬ couragements of the natural distribution of land. Tlieii in¬ fluence, for instance, on the progressive cultivation of the soil, has rendered it necessary for the Legislature to inteifeie, foi the accomplishment of that end, by a more indirect process than would otherwise have been necessary. In a commercial count] y , where there are no perpetuities, the attachment to land would be everywhere nearly proportioned to its intrinsic value ; and a * \ Commentaries, Book II. chap. vi. ; Vol. II. p. S3, fourteenth edition . | f [Book III. chap. ii. ; Vol. IT. p. 82, se 7, tenth edition.] 202 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. number of properties would be constantly brought to market, which would put an end to that monopoly price which land may be said at present to bear. Our existing institutions, by diverting small capitals from the purchase and improvement of land, contribute, more than any other single cause, to depress agricultural industry below the level of other employments of capital and labour. In this manner, the free circulation of land would animate and invigorate the remotest extremities of the political body ; while the natural course of human affairs would determine effectually those inequalities in the distribution of land and money, which are essentially connected with political sub¬ ordination, and with the progressive improvement of the human mind. There is not, indeed, among all the different objects of policy, any one instance which illustrates more strongly the good sense of the old French maxim, Not to govern too much , than that of the history of landed property, fettered, among the ancients, by agrarian laws, and among the moderns, by institu¬ tions of an opposite tendency, and so seldom left to the opera¬ tion of those natural causes which, wherever they have free scope, are found to be wisely and beneficently ordered for the improvement and prosperity of the human race. The Statute of Alienations, passed in the reign of Henry VII., is universally understood to have had a powerful influence on the subsequent progress, not only of agriculture, but of all the other arts ; and however just Mr. Hume’s strictures may be on the motives which influenced that sovereign in the enactment of this law,* the great and beneficial consequences which have followed from his innovation on the former system, are indisputable. The Statute of Alienations, like all other wise improvements in legis¬ lation, accomplishes its end, not by giving any sudden shock to the prejudices and interests of the existing generation, but by giving natural causes a time and opportunity to operate, and by removing those artificial obstacles which check the progres¬ sive tendencies of society. It may be proper to mention, before leaving this subject, that * [ History of England , Chap, xxvi.] CHAP. III. — OF TRADE. (§ 4.) 203 these general principles of Political Economy, though unques¬ tionably just, as far as regards the wealth and population of a country, may probably require some limitation, when applied to an actually existing government such as ours, where an order of Nobility makes an essential part of the constitution. Some deviations from a perfectly free commerce of land may, in such cases, be expedient to secure the independence of here¬ ditary legislators, and to accomplish whatever other purposes of their order may accord with the essential spirit of the con¬ stitution. It must never be forgotten, that wealth and popula¬ tion, though important objects of care, ought always to be regarded in their due subordination to those political arrange¬ ments on which the order of society depends. Even in such cases, however, the reasonable and equitable exception thus rendered necessary, should be carried no farther than the nature of the constitution requires. To those who wish to prosecute this subject, I would recom¬ mend a perusal of a Sketch of the History of Entails by Lord Kames, subjoined to his Sketches. In the same publication you will find a proposal by that ingenious and public-spirited writer, for the gradual removal of this disorder, for such I must call it, the general scope of which is, to prohibit Entails for the future, and to delare those that had been already made, effectual only to such of the heirs as should be in existence at the date of the proposed Act. A similar declaration is sug¬ gested with regard to trust-deeds, without a restriction of which Lord Kames says, that the other provision would be of little avail.* In conformity to the same wise and equitable respect for the interests of heirs actually existing, a committee was appointed, about fifty years ago, by a very respectable body in this country, the Faculty of Advocates, to frame such a Bill as that advised by Lord Kames. The general plan drawn up by the committee was very similar to that proposed by his Lordship * and according to the opinion of most persons at the time, the effect of this Bill, if passed into a law, would have * [Sketches, Appendix, Sketch i. ; Vol. IT. p. IdO, dto edition ] 204 POLITICAL ECONOMY, — PART I. — BOOK II. — NAT. WEALTH. been, that one half of the entails then existing would be sunk in twenty years, and nine-tenths of them in forty or fifty. A majority of the Faculty gave their sanction to this measure ; but, in consequence of some circumstances, the detail of which would be uninteresting, the whole project, after it had excited much discussion, fell to the ground. That this, or some similar palliative of an evil so great and so rapidly progressive, would be soon followed by the happiest effects, it is impossible to deny. To these very slight remarks on the Law of Entails , I shall make no apology for adding a few others on a subject to which it naturally leads the attention, though not immediately connected with the foregoing argument ; I mean the question relative to the limits within which the power of Testamentary Succession should be confined by law. This, indeed, may be considered as a sort of digression from the plan to which I have confined myself, as it relates to movables equally with immovables. But the subject will be found, if I do not de¬ ceive myself, to reflect some additional light on certain general principles which have been already stated : at any rate, it will be useful by turning your thoughts to a political problem which has attracted the attention of many eminent persons among our contemporaries, and to which I shall have no other oppor¬ tunity of attending before the conclusion of these lectures. As the Law of Entails leaves too much to the fancy of the proprietor in regulating the succession to his property, so some modern politicians have gone into the opposite extreme, by affirming that individuals ought to have no power to dispose of their property, real or personal, by Will ; and that all the rules of succession should be fixed by legislative authority. This seems to have been the opinion of Cocceii and of Turgot, and the same doctrine is maintained by the author of the Fre- derician code. It is not a little remarkable, that Sir William Blackstone has indirectly given his sanction to the equity of this project, by denying, not only that the right of testamentary bequests has any foundation in natural law, but by affirming that the case is the same with the right of succession of the children of a person deceased. “ We are apt to conceive at 205 CHAP. III. — OF TRADE. (§4.) first view, that this right has nature on its side ; yet we often mistake for nature what we find established by long and inve¬ terate custom. It is certainly a wise and effectual, hut clearly a political establishment ; since the permanent right of pro¬ perty, vested in the ancestor himself, was no natural , but merely a civil right.”* In so far as this reasoning rests on the supposition, that the personal right of property, vested in the ancestor himself, is not a natural one, I flatter myself, that it is sufficiently refuted by the observations which I have made in my other course, on the foundation of the right of property in the law of nature. f And as to the fact with respect to the right of inheritance, I believe it will be found, that the further back we carry our researches into the history of mankind, the stronger the general prepossessions of mankind will be in favour of the claims of children. With respect to the right of devis¬ ing by testament, Sir William Blackstone’s assertion, although not so strikingly contradicted by the general prepossessions of mankind, will be found to be stated in much too strong and unqualified a manner. It is true, that wills do not exist among rude nations ; for this plain reason, that it requires the aid of an established government to enforce the observance of them. But it does not appear from this that the right of testamentary bequest has no foundation in our sense of justice, any more than the respect paid by rude nations to the possessor in the case of stolen goods, proves that the right of property has no similar foundation. The truth, however, seems to be, that rude na¬ tions indirectly acknowledge the right of testamentary bequests, in the case, at least, of persons who have no children of their own, by the practice of adoption, which prevails almost uni¬ versally in the rude periods of society, and which answers nearly the same purpose as disposing of property by will. It is, indeed, the only way, till regular government is established, by which it is possible to render a last will effectual ; as, when it is resorted to, the property never wants a possessor. It may be worth while to add to this remark, that in the * [ Commentaries , Book II. chap. i. ; 4 [Supra, 11 oris, Vol. A II. pp. 2G0- Yol. II. p. 10, fourteenth edition.] 273.] 206 POLITICAL ECONOMY. - PART I. — BOOK II. — NAT. WEALTH. earlier ages of society, the habits and associations produced necessarily by the circumstances and relations of domestic life, supply, in many cases, the want of municipal regulations, and of a strict police. When we look back to the accounts of the patriarchal times, recorded in the Sacred Writings, we find the religious reverence with which the parental authority was re¬ garded securing to the death-bed injunctions of the head of the family, as complete an obedience as if he had still lived to enforce their execution. Of this we have a fine instance in the conversation between the patriarch Jacob, and his son Joseph, recorded in the forty- eighth chapter of the Booh of Genesis : — “ And Israel beheld Joseph's sons, and said, Who are these P “ And Joseph said unto his father, They are my sons, whom God hath given me in this place. And he said, Bring them, I pray thee, unto me, and I will bless them. “ Now the eyes of Israel were dim for age, so that he could not see. And he brought them near unto him ; and he kissed them, and embraced them. “ And Israel said unto Joseph, I had not thought to see thy face : and, lo, God hath shewed me also thy seed. “ And Joseph brought them out from between his knees, and he bowed himself with his face to the earth. “ And Joseph took them both, Ephraim in his right hand towards Israel's left hand, and Manasseh in his left hand towards Israel's right hand, and brought them near unto him. cc And Israel stretched out his right hand, and laid it upon Ephraim's head, who was the younger, and his left hand upon Manasseh’s head, guiding his hands wittingly ; for Manasseh was the first-born. “ And he blessed Joseph, and said, God, before whom my fathers Abraham and Isaac did walk, the God which fed me all my life long unto this day, “ The Angel which redeemed me from all evil, bless the lads ; and let my name be named on them, and the name of my fathers Abraham and Isaac ; and let them grow into a multi¬ tude in the midst of the earth. CHAP. III. — OF TRADE. (§ 4.) 207 “ And when Joseph saw that his father laid his right hand upon the head of Ephraim, it displeased him : and he held up his father’s hand, to remove it from Ephraim’s head unto Manasseh’s head. “ And Joseph said unto his father, Not so, my father: for this is the first-born ; put thy right hand upon his head. “ And his father refused and said, I know it, my son, I know it : he also shall become a people, and he also shall be great : but truly his younger brother shall be greater than he, and his seed shall become a multitude of nations. “ And he blessed them that day, saying, In thee shall Israel bless, saying, God make thee as Ephraim and as Manasseh : and he set Ephraim before Manasseh.” In this beautiful picture of patriarchal manners, we have a proof, not only of the extent of the father’s power in regulat¬ ing the succession to his property after his death, but in altering the rank and condition of his children, contrary to the arrange¬ ment pointed out by nature in the order of their birth, the religious reverence paid to his last injunctions, supplying the authority of laws and magistrates. We may remark also the effect of a very natural sentiment, in the peculiar latitude of bequest, which the patriarch found himself entitled to exercise with regard to that portion of his property which had been his own personal conquest. “ And Israel said unto Joseph, Behold, I die : but God shall be with you, and bring you again unto the land of your fathers. “ Moreover I have given to thee one portion above thy brethren, which I took out of the hand of the Amorite with my sword and with my bow.” These observations may be of some use in correcting the erroneous conclusions into which writers on jurisprudence have been led by the vague idea which they annex to the phrase natural law , — a phrase which they sometimes employ to ex¬ press the rules of justice in opposition to positive institutions, and sometimes to denote the practices of rude nations before the establishment of the power of the civil magistrate. J hat 208 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. Sir William Blackstone himself has been partly misled by this circumstance, the following passage seems a sufficient proof : — “ Wills and testaments, rights of inheritance and successions, are all of them creatures of the civil or municipal laws, and accordingly are, in all respects, regulated by them ; every dis¬ tinct country having different ceremonies and requisites to make a testament completely valid ; neither does anything vary more than the right of inheritance under different national establishments.”* If these reasonings were just, they would undoubtedly obviate one very strong objection to the project of Cocceii and Turgot, and would have the subject to be decided entirely on principles of political expediency ; not that I think the ideas of these two ingenious writers could be vindicated even on such grounds, for if they were carried into effect, a variety of mischievous consequences seems unavoidable. In the first place, the effect of such an arrangement would be to diminish the parental authority ; a principle, however, which, on the other hand, notwithstanding its importance to the welfare of society, may undoubtedly be carried too far, and which it may be expedient to restrain within due bounds, by securing to children a certain proportion of their father’s effects, placed beyond the reach of the caprices and bad passions to which human nature is subject. The second effect would be to damp the spirit of industry, by rendering men indifferent about the acquisition of riches, and disposing them to spend them with indiscretion. The third is, the effect it would have in leading them to transfer their property to other countries, where the interests of the community, and the feelings of in¬ dividuals, are treated with more respect. I confess, too, it appears to me, notwithstanding what Black- stone has said on this subject, that our natural sense of justice, independently of any views of expediency, dictates, that the fruits of a man’s laborious industry, or what is the same thing in the present constitution of society, everything which is fully and completely his own property, he should be able to transfer by * [ Commentaries , Book II. cliap. i. ; Vol. II. p. 12, fourteenth edition.] CHAP, HI. — OF TRADE. (§ 4.) 209 testament, agreeably to bis own pleasure, a due provision being secured to those individuals whom be lias been the means of bringing into the world, and to whom, independently of all con¬ siderations of their personal merit or demerit, he lies under obli¬ gations of the most sacred nature. But how far the right of bequest should extend in the case of landed property, is another question, upon which I do not presume to decide, any farther, than that it should not extend to any individuals who, at the death of the testator, were mere creatures of the imagination. Perhaps, as I hinted before, the principles of English jurispru¬ dence on this head, even with all the disadvantages resulting from their institution of trust-deeds, which reprobates perpetuities, but allows the testator, as far as he sees proper, to exert the powers of bequest in favour of any heirs actually existing at the time, is as consonant as any other that can well be imagined, to those established habits of thinking and feeling, which, in the present state of the world, it is peculiarly incumbent on a wise legislator to respect ; while, at the same time, its beneficial effects to society are incalculably great. Compared with our [the Scottish] system of policy in this respect, it leaves the commerce of land in a great measure free. With some slight restriction, therefore, the following sentiment of Sir William Blackstone is as just as it is elegantly expressed : — “ The trans¬ mission of one's possessions to posterity, has an evident ten¬ dency to make a man a good citizen and a useful member of society ; it sets the passions on the side of duty, and prompts a man to deserve well of the public, when he is sure that the reward of his services will not die with himself, but be trans¬ mitted to those with whom he is connected by the dearest and most tender affections.'’* In the case of those who die intestate, these considerations do not apply. Here the arrangements of the Legislature are unembarrassed by the regard which is always due to the feel¬ ings, and even prejudices, which are interwoven with the national manners. I could have wished to prosecute this subject a little farther, * [Commentaries, Book II. chap. i. ; Vol. II. p. 10, seq., fourteenth edition.] VOL. TX. 0 210 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. and to illustrate the happy effects which a general freedom of commerce and industry, in particular of landed property, pro¬ duces on the moral and intellectual improvement of mankind. The field, however, is too extensive to he now entered on. I shall content myself, therefore, with remarking how widely the characters of men are diversified by the species of property to which they attach themselves, as well as by the proportions in which it is distributed among them. The various pursuits of private life are still more remarkable in the strongly contrasted manners of an agricultural and of a commercial nation. It is only in such a state of society as that in which we live, in which commerce, agriculture, and manufactures act and react upon each other, that the human character and genius can be com¬ pletely developed. The inconveniences we labour under, which are comparatively few, arise chiefly from some legislative re¬ straints, which might easily be removed, without injury to individuals, or damage to the state, hfor can there be a doubt, that the progress of human reason, which has already accom¬ plished so much, will, gradually and slowly, correct these imperfections, and bring the established systems of Political Economy nearer and nearer to the order of nature. — (End of Interpolation from Notes.) [CHAPTER IV.] OF TAXES. [SECT. I. — OF TAXES IN GENERAL. — INTRODUCTORY.] It is evident that, in every political community, there are a variety of expenses which must be necessarily incurred by the sovereign for the public service. It is sufficient to mention the support of the Sovereign Dignity, — the Religious Establish¬ ment, — the Administration of Justice, — the National Defence, — besides Public Works, such as roads, ports, bridges, &c. These different objects of public expense (but, in a more especial manner, the exigencies of War) imply the necessity of a Public Revenue, to be at the disposal of the Sovereign, or of the Commonwealth. Something of this kind, therefore, may be considered as a necessary consequence of the Political Union ; and the only difference among states, in this branch of their economy, consists, in the different sources from which the Public Revenue is drawn. Among the nations of antiquity, the common practice appears to have been, to make provision for hostilities by hoarding up treasures during the intervals of peace which they enjoyed. Some good observations on this point of their policy may be found in the beginning of Mr. Hume’s Essay on Public Credit.1 It is unnecessary to prosecute the subject here, as their example has not been copied by any of the great European princes since the death of Henry IV. of France, with the exception of some of the last sovereigns in Prussia. Frederick William, at his death in 1740, is said to have left seven millions sterling in his treasury; and his son, Frederick the Great, (as we are assured * [ Essays , Vol. I.]— See Filangieri, [. Riflessioni Politick e, &c.] Vol. II. p. 372. 212 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. by the Baron de Hertzberg,) accumulated twice the most considerable treasure that any prince ever possessed.1 It is, however, only by a very singular combination of circumstances that such a parsimonious spirit can exist for a length of time in a great monarchy in the present state of European manners. Nor is the case very different in our modern republics, of which many are in debt, and none are supposed to have amassed any¬ thing that deserves the name of a treasure but the Canton of Berne. In great and civilized states, too, the progress of luxury and expense renders public stock and public lands altogether inade¬ quate resources for supplying the necessary demands of Govern¬ ment. With respect to the former, a sufficient objection arises from the unstable and perishable nature of stock and credit, in consequence of which they cannot be trusted to with safety as the principal funds of a sure, steady, and permanent revenue ; and as to the latter, it is asserted by Mr. Smith,* that “ in the present state of the greater part of the civilized monarchies of Europe, the rent of all the lands in the country, managed as they probably would be if they all belonged to one proprietor, would scarce amount to the ordinary revenue which they levy upon the people even in peaceable times.”2 It follows from these observations, that in the present state of the great nations of Europe the greater part of the expenses of Government must be defrayed by taxes of one kind or another ; or, in other words, by the contribution of private revenue for public purposes. As the sum which the state raises in this manner is the price of the protection which Government affords to the subject, there can be no limitation to the extent of what may be equitably levied, provided the value of the protection afforded is adequate to the amount of the contribution collected. It is, however, the most important duty of a statesman to 1 Guthrie’s Grammar , p. 471. Hertz- * [ Wealth of Nations, Book V. chap, berg’s Two Discourses, &c. p. 3 ; p. 37 ii. ; Vol. III. p. 250, tenth edition.] of the original. The translation is printed for Lilly, 1786. 2 Filangieri, [Ibid.] Yol. II. p. 318. 213 CHAP. IV. — OF TAXES. (§1.) draw from the subject the necessary supply, in the manner the fairest and the least oppressive,— a task of which the difficulty appears to increase with the extent of the sum to be raised. To devise the most effectual means of accomplishing this end is the great object of the art of finance , — a branch of Political Economy which has long employed the speculations of the ablest and most enlightened men in Europe, without, however, as yet leading to any systematical result in which all parties are agreed. In England, more particularly, and in France, this science has exercised the ingenuity both of speculative and practical politicians in a singular degree, in consequence of the immense revenue which the magnitude of the public debts rendered absolutely necessary. These debts were indeed con¬ tracted, in the first instance, with a view to relieve the subject from oppressive impositions ; but it is manifest that the relief which was thus procured to the existing generation was pur¬ chased by transferring the load to their posterity with an accumulated weight. It may be worth while to state, in a few words, (before entering on the subject of Taxation,) by what gradual steps the Funding System arose, as it may now be justly considered as the principal cause of the heavy burdens to which we are subjected. The origin of Public Funds is to be traced from the peculiar manners and circumstances of modern Europe. In former times, princes had often borrowed money to supply their exigencies, and sometimes mortgaged their territories in secu¬ rity ; but these loans were generally extorted, and their pay¬ ment always precarious ; for it depended on the good faith and success of the borrower, and never became a regular burden on posterity. Since the invention of gunpowder and the progress of com¬ merce, the military art has become a distinct employment in the hands of mercenaries ; the apparatus of war is attended with more expense \ and the decision of national quarrels has often been determined by command of money rather than by national bravery. Ambitious princes have therefore borrowed money, in order to carry on their projects with more \ igoui , 214 POLITICAL ECONOMY. — PARTI. — BOOK II. — NAT. WEALTH. weaker states have been compelled, in self-defence, to apply to the same resource ; the wealth introduced by commerce has afforded the means ; the regularity of administration, established in consequence of the progress of civilisation, has increased the confidence of individuals in the public security ; the compli¬ cated system of modern policy has extended the scenes of war, and prolonged their duration ; and the colonies established by mercantile nations have rendered them vulnerable in more points, and increased the expense of defending them. When a greater sum has been required for the annual expense than could easily be supplied by annual taxes, the Government have proposed terms to their own subjects, or foreigners, for obtaining an advance of money, by mortgaging the revenue of future years for their indemnification. The sums which have been thus lent to Government, and which constitute the national debt, form what are called the Public Funds . The practice was introduced by the Venetians and the Genoese in the sixteenth century, and has been adopted since by most of the nations of Europe/'1 It is justly observed by Mr. Smith, that “ the same commer¬ cial state of society which, by the operation of moral causes, brings Government into the necessity of borrowing, produces in the subjects both an ability and an inclination to lend.”* Merchants have at all times a proportion of their capital, and of the average returns of trade within their reach. Their natural confidence in the state where their property is lodged, leads them (particularly under free governments) to trust to the public faith, or if they should apprehend any unusual risk, the alarm will only have the effect of enhancing their demands in settling the terms of their bargain. As the debts, however, 1 Hamilton, [ Introduction , &c.,] pp. upon which the interest of the public 548, 549. With respect to the particu- debts is secured. The former definition, lar use of the word Fund , (which in its however, (which applies it to the capitals common acceptation means a sum of or debts upon which the interest is pay- money appropriated for any particular able,) has been long sanctioned by uni¬ purpose,) it maybe proper to observe, versal custom. — Fairman, On the Stocks. that according to strict analogy it ought * [ Wealth of Nations, Book V. chap, to be applied to the Taxes or Revenues iii- ; Vol. III. p. 400, tenth edition.] C1IAP. IV. 215 — OF TAXES. (§ 1.) contracted by Government with the public creditors, differ from those between individuals in one important particular, that, in the former the lender is not at liberty to reclaim his principal, it is reasonable that the obligation from Government be of such a nature as to make the debt transferable to any other person who may be inclined to purchase it. The regular payment of the interest on the Government Funds, and the number of persons in this country who prefer the interest they afford to the hazardous profits of trade, secure continual demands for those shares in them which are brought to market. The facility also, and trifling expense with which transfers are made in these funds, are inducements to prefer vesting money in them to laying it out on mortgages or other private security, which, though probably yielding a greater interest, is frequently attended with trouble and uncertainty.1 By these constant transferences, the confidence reposed in the State is maintained and augmented ; the funds are converted into a mighty engine for the ^circulation of capital ; an immense field is opened for mercantile speculation in transactions with Government, and it becomes an object of interest and competition to advance money to the public. The consequence is such as might be expected ; the readiness to lend increases the disposition to borrow, and the facility of getting money lessens the anxiety to save. Hence the rapid progress of the enormous debts which at present oppress all the great nations of Europe. “ The progress of these debts/' as Mr. Smith has remarked, has been everywhere pretty uniform. Nations, like private men, have generally begun to borrow upon what may be called personal credit, without assigning or mortgaging any particular fund for the payment of the debt ; and when this resource has failed them, they have proceeded to borrow upon assignments or mortgages of particular funds.”1 * The establishment of the funds was introduced into Britain at the time of the Revolution, and has since been gradually en¬ larged, and carried to an amazing extent. In the reign of 1 Fairman, On the Stocks. chap. iii. ; Vol. III. p. 402, tenth •* [ Wealth of Nations , Book V. edition.] 216 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. King William, and during a great part of that of Queen Anne, the greater portion of the new taxes were imposed but for a short period of time, (for four, five, six, or seven years only,) and a great part of the grants of every year consisted in loans upon anticipations of the produce of those taxes. The produce being frequently insufficient for paying within the limited term the principal and interest of the money borrowed, deficiencies arose, to make good which it became necessary to prolong the term. The continued operation of the same causes led Government to go on in this business of anticipation by mortgaging taxes for farther loans and longer periods, till they at length made the assignments perpetual in a great proportion of cases, or in other words converted taxes into a fund for the payment of perpetual annuities. In this manner, the greater part of the taxes which before had been anticipated only for a short term of years, were rendered perpetual, for the purpose of paying, not the capital, but the interest only, of the money which had been borrowed upon them by different successive anticipations. The obvious effect of this practice is to put off the liberation of the public revenue from a fixed period to an indefinite one. As a greater sum, however, can, in all cases, be raised by this plan of 'perpetual funding , than by the old method of anticipations, the former has, in the great exigencies of the state, been universally preferred to the latter. a To relieve the present exigency/’ says Mr. Smith, “is always the object which principally interests those immediately concerned in the administration of public affairs. The future liberation of the public revenue they leave to the care of posterity/7* This mode of raising money by anticipations and by funding, is the least disagreeable of any to the people, because large sums are obtained for small annual taxes ; and even when these annual taxes are multiplied, the expenditure of the sums raised upon them furnishes occupations which benefit a large proportion of the community. Nor is it a consideration of trifling moment, that this expenditure is frequently a source of great and interesting events which amuse the imaginations of * [Ibid. p. 409/ 217 CHAP. IV— OF TAXES. (§ 1.) men, even when the events on the whole are unfavourable to their interests. The contingencies of a great war have, in this respect, not unaptly been compared to the u caparisons and bells, which, by their show and jingle, induce a poor animal to jog on under his load, with cheerfulness.”1 According to some writers, the introduction of this system by King William, was the effect of political foresight, in order to secure the attachment of individuals to Government, from the dependence of their property on its support and security ; by others, it has been ascribed to a disposition in Ministers to multiply places, and to gain patronage ; by a third description of politicians, (with still greater absurdity,) to the view of increasing the capital property of the kingdom. From the remarks which have been made, it appears plainly to have been the natural offspring of the circumstances in which the country was placed, and which, in proportion as they have existed in the other states of Europe, have been followed by similar con¬ sequences. At the death of King William, our public debt was about fourteen millions sterling. At the death of Queen Anne, it amounted to fifty millions.2 In the year 1797, (according to a report of a Committee of Parliament,) the funded debt amounted to £380,672,945.3 Our present war expenditure exceeds £30,000,000, and our permanent taxes amount to upwards of £20,000,000.4 I have entered into this detail concerning the Funding System, in order to convey a general idea of the causes which 1 Eden’s Letters, p. 86. 2 The war of 1739 increased it to more than 78 millions. Before the breaking out of the war of 1755, it was reduced to little more than 72| millions. But at the conclusion of the peace in 1763, the funded debt amounted to more than 1224 millions, and in 1764, the whole debt was 1 394 millions; and by the American war, it was in¬ creased to upwards of 230 millions — Smith, f Wealth of Nations , Book V. chap. iii. ; Vol. III. p. 421, seq ., tenth edition.] 3 Eden, [ l . c.] p. 92 ; Hamilton, [ l . c.J p. 552. 4 Lauderdale’s last Pamphlet. Dur¬ ing the American war the expendi- ture never exceeded £20,000, [000,] and the permanent taxes never ex¬ ceeded £1 0,000,000. — Ibid. Permanent Taxes in 1783, £10,194,259 ; in 1798, £2 1 ,049,945. — Pose's Pamphlet. 218 POLITICAL ECONOMY. — PAKT I. — BOOK II. — NAT. WEALTH. have produced such a weight and complication of taxes in some of the greater states of modern Europe ; and which have of consequence rendered the principles of taxation one of the most important in the science of Political Economy. What are the effects of such enormous burdens on the industry, the popula¬ tion, and the general industry of a country, is a question of very difficult discussion, to which different and opposite answers have been given by some of our most eminent writers. In the very general sketches to which I am obliged to confine myself at present, it is impossible for me to attempt an exami¬ nation of their arguments ; and therefore I shall content myself (without expressing any opinion of my own) with pointing out this inquiry as one of the most interesting which this branch of Political Economy presents to the curiosity of a subject of Great Britain. The most ingenious and best informed writer who has hitherto appeared as an advocate for the policy of our national debt, is Mr. Pinto, a Portuguese Jew, of whom I had occasion formerly to make mention. [Pol. Econ. Vol. I. pluries*] His Essay on Circulation and Credit is said, by Sir Francis DTvernois, to “ be the first work in which the true theory of National Debts' was unfolded ; and to contain/7 in his opinion, “ a greater variety, both of luminous views and of practical truths, than all the writings of the French Economists put together.” The utility of the National Debt is also contended for, though on different and much less plausible principles, by the late Soame Jenyns ; and by Mr. Edward King, in a pamphlet, (published in 1793,) entitled Considerations on the Utility of the Na¬ tional Debt } Sir F. DTvernois, in some of his late publica¬ tions, takes nearly the same ground with Mr. Pinto. The arguments on the other side may be found in Mr. Hume and Mr. Smith. The latter has suggested various observations which are particularly directed against the theory of Pin to. f The former treats his antagonists with still less ceremony, com- * [For articulate references, see Index. ] f [ Wealth of Nations , Book Y. c. iii. ; 1 Printed for T. Payne, Mews Gate, Vol. III. p. 424, seq., tenth edition.] [London.] 219 CHAP. IV. — OF TAXES. (§1.) paying their apologies for the national debt to u the panegyrics that were pronounced at Rome, as trials of wit, on Folly and Fevers, on Busiris and Nero.”* Among the various ingenious remarks which Mr. Hume has made on this subject, there is one very unaccountable observation in the earlier editions of his Political Discourses. “ There is a word/' says he, “ which is here in the mouth of everybody, and which has also, I find, got abroad, and is much employed by foreign writers in imitation of the English, and that is Circu¬ lation. This word serves as an account of everything ; and though I confess that I have sought for its meaning in the present subject ever since 1 was a schoolboy, I have never yet been able to discover it. What possible advantage is there which the nation can reap by the easy transference of stock from hand to hand ? Or is there anything parallel to be drawn from the circulation of other commodities, to that of chequer notes and India bonds ?”f This observation is the more extraordinary, that in the next paragraph a very satisfactory answer is given to the fore¬ going questions. “ Public securities are with us become a kind of money, and pass as readily at the current price as gold or silver. Wherever anyj)rofitable undertaking offers itself, how expensive soever, there are never wanting hands enough to embrace it; nor need a trader, who has sums in the public stocks, fear to launch out in the most extensive trade, since he is possessed of funds which will answer the most sudden demand that can be made upon him. No merchant thinks it necessary to keep by him any considerable cash. Bank stock, or India bonds, especially the latter, serve all the same pur¬ poses ; because he can dispose of them, or pledge them to a banker in a quarter of an hour ; and at the same time, they are not idle even when in his escritoire, but bring him in a con¬ stant revenue. In short, our national debts furnish merchants with a species of money that is continually multiplying in their hands, and produces sure gain, besides the profit »s ot their com¬ merce. This must enable them to trade on less pi oil t. the * [Essay*, Vol. I. Of Public Credit .] f [Ibid-> old editions.] 220 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. small profit of the merchant renders the commodity cheaper, causes a greater consumption, quickens the labour of the common people, and helps to spread arts and industry through¬ out the whole society.”* There is reason to believe that Mr. Hume came, in the pro¬ gress of his speculations, to be aware of this inconsistency ; as Mr. Pinto assures us, that when he saw Mr. Hume at Paris, the latter expressed great satisfaction with the Essay on Public Credit and he adds, “ I flatter myself he will one day correct some of his ideas on this subject.” One thing is certain, that in the last edition of Mr. Hume's Discourse , he has sup¬ pressed entirely the passage already quoted about the obscurity of the word circulation as it respects public credit. Of the general question which has divided the opinion of these authors, a question so difficult in itself, and which comes home so directly to the most momentous interests of this country, it never was my intention to treat in a course of academical lectures. But I could have wished to have had it in my power to give a general outline of the speculations of our most eminent practical politicians on a subject less delicate, and at the same time more immediately useful ; the means of raising those supplies (which are rendered indispensable by our actual circumstances) in a way the least unjust to individuals, and the least calculated to obstruct the national opulence and improvement. Even in considering this article, it was not my design to deviate from the common track of speculation, but to confine myself to a statement of those principles which have had the chief influence of late on the policy of Great Britain. In a field where the most splendid talents have been so often em¬ ployed, some important conclusions could not fail to reward a diligent survey ; and at any rate an acquaintance with preval¬ ent ideas forms a necessary branch of information, whatever judgment we may find reason to pronounce on their solidity. The ivhole of this subject , however , I must omit at present , as I am anxious to proceed at our next meeting to that article of Political Economy which relates to the poor. What remains * [Ibid.] 221 CHAP. IV. — OF TAXES. (§ 1.) of this lecture, I shall employ in some remarks on taxes which affect the rent of land ; a branch of the general speculation which I select in preference to others, not only as it occupies the first place in Mr. Smith’s arrangement, but as it will fur¬ nish me with an opportunity of mentioning a few particulars concerning the origin of that project of a territorial tax , which is commonly ascribed to the French Economists. In entering on the subject of Taxation , Mr. Smith states four maxims as general and fundamental principles by which the comparative advantages and disadvantages of particular taxes may be estimated. Their evidence appear to him to he such, as to supersede the necessity of any illustration. “ 1. The subjects of every state ought to contribute towards the support of the Government as nearly as possible, in propor¬ tion to their respective abilities. ... In the observation or neglect of this maxim consists what is called the equality or inequality of taxation. . . . “ 2. The tax which each individual is hound to pay ought to be certain, and not arbitrary. The time of payment, the manner of payment, the quantity to be paid, ought all to be clear and plain to the contributor, and to every other person. Where it is otherwise, every person subject to the tax is put more or less in the power of the tax-gatherer, who can either aggravate the tax upon any obnoxious contributor, or extort, by the terror of such aggravation, some present or perquisite to himself. . . . “ 3. Every tax ought to be levied at the time, or in the manner in which it is most likely to be convenient for the con¬ tributor to pay it. . . . “ 4. Every tax ought to be so contrived as to take out of the pockets of the people as little as possible over and above what goes into the treasury of the state.”* Of these maxims, the last three are expressed with sufficient precision, and may be safely assumed as self-evident tiutlis. The first (which relates to what Mr. bmith calls the equality of taxation) is stated in terms so vague and ambiguous, that * [Wealth of Nations, Book V. cliap. ii. ; Vol. HI. pp- 255-257, tenth edition.] 222 POLITICAL ECONOMY. — PART I. — BOOK II. - NAT. WEALTH. it is hardly possible to make any use of it as a principle of reasoning. This is the more remarkable, that it is to be found in almost every writer who has treated of Political Economy. If, indeed, by the equality of taxation , it is meant merely that taxes ought to be imposed in as equitable a manner as possible, for the luhole community , without partiality or pre¬ judice to particular individuals, or to particular classes of men, it may well be regarded as a principle whose evidence suffi¬ ciently recommends it, without the aid of any comment ; and it is in this sense alone that I would be understood to employ the phrase, if at any time it should occur in the course of our future reasonings. It is curious, however, that while all writers agree in stating the maxim as a self-evident truth, hardly any two agree in giving the same interpretation to the word ability ; and the greater part ascribe to it meanings that involve very problematical propositions. Mr. Smith, for example, after stating the maxim, adds the following explanation : — “ That is, the subjects of every state ought to contribute towards the support of the Government, as nearly as possible in proportion to the revenue which they respectively enjoy under the protec¬ tion of the state.”1 * Mr. Young, on the other hand, in com¬ menting on the very same maxim, remarks, that “ by ability must not be understood either capital or income, but that superlucration , as Davenant called it, which melts in consump¬ tion. Suppose, (for example,) a manufacturer makes a profit of £2000 a year, living upon £500, and annually investing £1500 in his business, it is sufficiently obvious, upon just prin¬ ciples, that the state cannot lay the £1500 under contribution by taxes. The £500 is the only income exposed. But when the manufacturer dies, and his son turns gentleman, the whole income is made to contribute. ... In like manner, if a landlord farm his own estate, and expend the income in im¬ provements, living on but a small portion of the profit, it is sufficiently clear that taxes ought not to affect one shilling of his expenditure on his land ; they can reach with propriety the expenses of his living only ; if they touch any other part of his * [Ibid. p. 255.] 223 CHAI\ IV.— OF TAXES. (§ 1.) expenditure, they deprive him of those tools that are working the business of the state. The proposition, therefore, that a man should pay according to his ability , must he understood in a restrained sense/'1 Sir James Steuart lays it down as a general principle, that “ according to equity and justice, all impositions whatsoever ought to fall equally and proportionally on every on q according to his superfluity that is, (as he explains himself afterwards,) according to the income that remains to him after the neces¬ sary expense of subsistence. “ Whatever a people consumes," he observes, “ beyond the necessary, I consider as a superfluity which may be laid under taxation." f And in another passage, “ nothing can be the object of taxation, except what is over and above the physical necessary of every one/'t I have mentioned these different interpretations of Mr. Smith’s first maxim, not with a view of deciding in favour of any one of them in preference to the others, but to express my dissent from all of them , when stated in the form of self-evident propositions. The maxim, indeed, as first announced by Mr. Smith, has the appearance of an axiom ; and in the very general sense in which I have explained it, nobody can dispute its claim to this appellation ; but, according to the meanings annexed to it both by this writer and the others just now quoted, it is made a pretext for prejudging, without any examination, one of the nicest questions which are connected with the theory of taxation. It is very rarely indeed, that in morals or in politics, we can follow with safety the mathematical mode of reasoning synthetically from general principles. Few maxims are to be found which are perfectly indisputable when proposed in an abstract form ; and even when such occur, there is a danger (as in the present instance) of their being differently under¬ stood by different individuals, according to their pre-conceived theories, so as to give a false shew of demonstrative evidence to reasonings which lead, to widely different conclusions. 1 [Political Arithmetic f\ pp. 52 1 , 522. f [Ibid. p. 317.] * [ Political ( 'Economy , Book V. chap, xii. ; Work Yol. IV. p. 298.] \ [Ibid. p. 314.J 224 POLITICAL ECONOMY. - PART I. — BOOK IL — NAT. WEALTH. To these maxims of Mr. Smith, the following one may be added as a principle equally general in its application, — 5. No tax should be imposed in such a manner as to drain the source from which it is derived or, (as Sir James Steuart- expresses it,) u Taxes ought to affect the fruits and not the fund”* Impositions, which necessarily imply a diminution of any capital, cannot properly he ranged under the head of taxes , inasmuch as every payment diminishes necessarily the produc¬ tiveness of the tax in future. In fact, every such contribution realizes the fable of the boy who killed the goose with the golden eggs. u Thus,” says the last mentioned writer, “ when the Dutch contributed, not many years ago, the hundredth part of their property to the service of the state, I cannot properly consider that in the light of a tax ; it was indeed a most public spirited contribution , and did more honour to that people, from the fidelity with which it was made, than anything of the kind ever boasted of by a modern society.”! In the examination of particular taxes, Mr. Smith arranges his observations under four heads,! suggested to him by the Analysis given in another part of his work, of the sources of private revenue. As the revenue of individuals arises ulti¬ mately from three different sources, rent, profit, and wages, every tax must finally be paid from some one or other of these, or from all of them indifferently. Accordingly, he treats (1.) Of those taxes which it is intended should fall upon rent ; (2.) Of those which it is intended should fall upon profit ; (3.) Of those which it is intended should fall xrpon wages; and (4.) Of those which it is intended should fall indiffer¬ ently upon all those three different sources of private revenue. In the further prosecution of the subject, I shall follow the same arrangement, beginning (according to Mr. Smith's order) with the consideration of taxes upon rent.§ 1 Ferguson, [ Principles of Moral and f [Ibid. pp. 175, 176.] Political Science, Part II. chap. vi. sect. t [Wealth of Nations, Book Y. chap. 5;] Yol. II. p. 436. ii. ; Yol. III. p. 259, seq., tenth edi- * [Political QHconomy, Book Y. tion.] chap. i. ; Works , Yol. IV. p. 175.] $ [See the next following note.] CHAP. IV. OF TAXES. (§ 2.) 225 [SECT. II.] — TAXES UPON LAND* [subsect, i.] — Taxes upon the Rent of Land. A tax upon the rent of land may be imposed in tivo different ways : — i. It may be imposed according to a certain Rule or Canon, which, being once fixed, is understood not to be liable to subsequent alterations ; or, ii. It may be proportioned to the actual rent , rising or falling, according to the progressive or declining state of the land in point of cultivation. [Of these in their order.] [i.] — The Land Tax in England is of the former description. The original of this tax is traced by Sir William Blackstone to the period when military tenures were introduced, when every tenant of a knight’s fee was bound, if called upon, to attend the king, in his array, for forty days in every year. But this per¬ sonal attendance growing troublesome in many respects, the tenants found means of compounding for it, by first sending others in their stead, and, in process of time, by making a pecuniary satisfaction to the crown as an equivalent. This pecuniary satisfaction at last came to be levied by assess¬ ments, at so much for every knight’s fee, under the name of scutage , which appears to have been levied for the first time in the 5th year of Henry II., on account of his expedition to Toulouse, and were then, probably, mere arbitrary compositions, as the king and the subject could agree. But this precedent being afterwards abused into a means of oppression, it became a matter of national complaint; and King John was obliged to promise, in his Magna Charta , that no scutage should be im¬ posed without the consent of the Common Council of the realm. Of the same nature with scutages upon knights’ fees, were the assessments of hydage upon all other lands, and of tallage upon cities or burghs. But they all gradually fell into disuse upon the introduction of subsidies about the time of King Bichaid II. and King Henry IV. These were a tax, not immediately * [It has been found requisite to mo¬ dify the distribution of Mr. Smith and Mr. Stewart, stated in the last preced- VOL. IX. ine; page. The word “Land” is here substituted for the word “ Rent.”] I’ 226 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. imposed upon property, but upon persons in respect of their reputed estates, after the nominal rate of four shillings in the pound for lands, and two shillings and eightpence for goods, and for those of aliens in a double proportion. But this assess¬ ment was also made according to an ancient valuation, in which the computation was so very moderate, and the rental of the kingdom was supposed to be so extremely low, that one subsidy of this sort did not, according to Sir Edward Coke, amount to more than £70,000, whereas a modern land-tax, at the same rate, produces two millions. It was anciently the rule never to grant more than one subsidy and two fifteenths1 at a time ; but this rule was broken through, for the first time, on a very pressing occasion, — the Spanish invasion in 1588, when the Parliament gave Queen Elizabeth two subsidies and four fifteenths. Afterwards, as money sunk in value, more subsidies were given ; and we have an instance, in the first parliament of 1640, of the king's desiring twelve subsidies of the Commons, to be raised in three years, — a proposal which excited much alarm at the time, although the total amount of the sum to be thus levied, (according to Blackstone s calculation,) is less than what is now raised in one year by a land-tax of two shillings in the pound. The subsidy was usually raised by Commissioners appointed 1 Tenths and fifteenths were temporary aids, issuing out of personal property, and granted to the king by parliament. They were formerly the real tenth or fifteenth part of all the movables be¬ longing to the subject. Tenths are said to have been first granted under Henry II. ; but, afterwards, fifteenths were more usually granted than tenths. Originally the amount of these taxes was uncertain, being levied by assess¬ ments, new made’ at every fresh grant of the Commons ; but it was at length reduced to a certainty in the 8th year of Edward III., when, by virtue of the King’s Commission, new taxations were made of every township, borough, and city in the kingdom, and recorded in the Exchequer, w’hich rate was, at the time, the fifteenth part of the value of every township, the whole amounting to about £29,000. And, therefore, it still kept up the name of a fifteenth, when, by the alteration of the value of money, and the increase of personal property, things came to be in a very different situation. So that, when of later years the Commons granted the king a fifteenth, every parish in England immediately knew their proportion of it ; that is, the same identical sum that was assessed by the same aid in the 8th of Edward III., and then raised it by a rate among themselves, and re¬ turned it into the Royal Exchequer. — Blackstone, Commentaries^ ol.I. p. 308. 227 CHAP. IV. — OF TAXES. (§ 2.) by the Crown, or the Great Officers of State ; and, therefore, in the beginning of the civil wars between Charles I. and his Parliament, the latter having no other sufficient revenue to support themselves and their measures, introduced the practice of laying weekly and monthly assessments of a specific sum upon the several counties of the kingdom, to be levied by a pound rate on lands and personal estates ; which were occa¬ sionally continued during the whole usurpation, sometimes at the rate of £120,000 a month, sometimes at inferior rates. After the Restoration, the ancient method of granting subsidies, instead of such monthly assessments, was twice , and twice only , renewed, viz., in 1663 and in 1670, (when £800,000 was raised by way of subsidy,) which was the last time of raising supplies in that manner. For the monthly assess¬ ments being now established by custom, being raised by Com¬ missioners named by Parliament, and producing a more certain revenue ; from that time forwards we hear no more of sub¬ sidies, but occasional assessments were granted as the national emergencies required. These periodical assessments, the subsidies which preceded them, and the more ancient scutage, hydage, and talliage, were, to all intents and purposes, a land-tax; and the assessments were sometimes expressly called so. The idea, therefore, of taxing landed property was by no means a novelt)r, (as some have supposed,) introduced in the reign of William III. ; all that was then done was to extend the principle, by introducing a new plan for levying the tax, agreeably to a new assessment or valuation of estates throughout the kingdom. This valua¬ tion was made in 1692, and it is according to that, Parliament at present renews the grant of the land-tax, and orders it to be collected. It is observed by Mr. Christian, in his Botes on Blachstone , that even the plan and arrangements for levying this tax (as specified in the 4th of William and Mary) are, in all the most important particulars, copied from the Act of Charles II., already referred to, (22 and 23 Car. II., passed in 1670,) in which the mode of collecting the land-tax differs totally from the former subsidy assessment, and appears to have been 228 POLITICAL ECONOMY. — PART I. — BOOK II. - NAT. WEALTH. suggested by an Act passed in the time of the Commonwealth; (1656,) for an assessment to raise £60,000 a month. Before proceeding farther, it is proper for me to remark, that what is called the Land-tax in England, does not affect merely landed property, but all personal estates, except property in the public funds, and stock upon land, supposed necessary for agri¬ culture. With these exceptions, all personal estates are charged in the same proportion as land-rents. In this respect, the land-tax, as it is levied at present, agrees with the subsidies and other taxes already referred to. “ Indeed,” as Sir James Steuart observes, “ there is no vestige in the History of Eng¬ land of any tax imposed singly on land. The subsidies, monthly assessments, and pound-rates in the different stages of the monarchy, have all been mixed duties, composed of a charge upon the lands, upon the money and personal estates of the subject, and frequently including a poll-tax, where men of different ranks were differently charged/’* According to the valuation made in 1692, a supply of £500,000 was equal to one shilling in the pound of the value of the estates given in. Since that period it has continued an annual charge on the subject ; — in general, at four shillings in the pound, sometimes at three, sometimes at two ; twice at one (viz., in the years 1732, 1733,) but without any total inter¬ mission. The method of raising it is, by charging a particular sum upon each county, according to the valuation given in, in 1692; and this sum is assessed and raised upon individuals, (their personal estates as well as real , being liable to the tax,) by Commissioners appointed in the Act, being the principal landholders of the county, and their officers. It is commonly understood that the valuation according to which the different counties and parishes were assessed to the land-tax by the 4th of William and Mary, was very unequal at its first establishment, in consequence of the liberality or fraud of the owners and assessors in their representations of the value, produced by their attachment or aversion to the new govern¬ ment. In this respect, therefore, the English land-tax was * [ Political (Economy, Book V. chap, xi., footnote; Works, Yol. IV. p. 280. J 229 CHAP. IV. - OF TAXES. (§ 2.) even from the beginning reprehensible upon the general prin¬ ciple stated by Mr. Smith, as the first of his fundamental maxims. Besides this inequality, however, another disproportion in the general assessment has been occasioned by the unequal cul¬ tivation of the different counties of England since the close of last century, and such has been the effect of these two causes combined, that while some estates pay four shillings, others pay fourpence, or even less, by the same rule of proportion. A late writer asserts, upon good information, that a gentleman possess¬ ing an estate of £5000 a year, in one of the northern counties of England, pays in land-tax, at four shillings in the pound, only £75.1 To an inequality of the same kind, every land-tax must necessarily become liable in process of time, which is imposed according to a certain invariable canon, however equitably that canon may have been adjusted at the time it was established. This defect, in point of equality is, in the opinion of Mr. Smith, the only one which can be objected to the English land-tax : — “ It is perfectly agreeable,” he observes, “ to all the other general principles which ought to regulate taxation and, more particularly, he adds, “ it possesses the recommenda¬ tion of perfect certainty ”* In opposition, however, to this unqualified encomium, some¬ thing may be objected ; and, in fact, a very able writer, Sir J. Steuart, has fixed on this very circumstance of certainty as one in which the English land-tax is remarkably defective. “ The sums imposed,” says he, “ at so many shillings in the pound upon every district in the kingdom, whether cities, towns, uni¬ versities, or open country, &c., are not distributed according to any rule of proportion upon the property of individuals ; but this operation is left to assessors. . . . By the original distri¬ bution, indeed, it appears what every city, county, university, &c., is to pay according as the tax is imposed at one, two, three, or four shillings in the pound. Still, however, such a regula¬ tion nowise prevents the inconveniences which attend this tax, because the burden of it does not consist in the total amount 1 Gray’s Pamphlet. Bechet, 1707, p. 104. * | Wealth of Nations, Book V. chap, ii. ; Vol. III. p. 260, tenth edition.] 230 POLITICAL ECONOMY. — PART I.— BOOK II. — NAT. WEALTH. so much as in the particular distribution upon the inhabitants in every subdivision. “ Suppose, for example, the proportion of the general sum for a particular district to be £10,000 at four shillings in the pound, how is this to be levied as the law stands ? Instead of books of valuation, which shew at least the proportion of every man’s property, if not the real value of it, assessors are con¬ stantly called in, who examine the rents of all the lands according to the last leases of them. If they have been im¬ proved and let at a higher rent than formerly, the proportion of the tax is augmented. If they have not been let, but remain in the possession of him who improved them, the tax is not augmented. If the tax be found to fall too heavy upon the lands and houses, then personal estates are made to contribute, as is the case in London. All questions or disputes about the repartition of the tax, are determined, without appeal to the courts of law, by the commissioners appointed for laying on the tax; as in France, (under the old Government,) they were determined by the Intendant.”* And, indeed, without this regulation (as Sir James Steuart himself acknowledges) all would run into confusion. In proof of this opinion he observes, that . 537. 2 See a Pamphlet, entitled 'The Mo- derale Reformer, hi/ a Friend tu th Church of En< /land, (White, IT'.U.) 246 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. It is remarkable, that notwithstanding these consequences of which Europe lias so long had experience, and which are too obvious to require particular illustration, advocates have been found for this very plan of taxing the produce of land, as the most expedient system according to which land-taxes can be imposed. A proposal of this sort was made to the French Government in 1699, by the celebrated Marechal de Vauban , who wished to abolish the Taille , (as it was paid under the old establishment,) together with the capitation , industries and all the other taxes committed to the management of the inten- dants ; and. to establish, in their stead, what he called a royal tenth, ( dime royale ;) meaning by this term, a proportion of all the fruits of the earth, similar to what is established in favour of the clergy. This he proposed to lay on, according to the exigencies of the State, from one-twentieth part to one- tenth, upon every article of the gross produce of the land over all France. The circumstances which suggested this project, (the greater part of which arose from the peculiar system of taxation in his own country,) and also the insurmountable obstacles to its execution, are fully stated by Sir James SteuartA In many parts of Asia, the state is principally supported by a land-tax proportioned to the produce. In China, it consists in a tenth part: but this tenth is so very moderately estimated in many provinces, as not to exceed a thirtieth. The land-tax which used to be paid to the Mahometan Government of Ben¬ gal, before that country fell into the hands of the Ehglish East- India Company, is said to have amounted to about a fifth part of the produce ; and the same proportion is mentioned in the accounts given of the land-tax in Ancient Egypt. In consequence of this system of taxation, it is pretended, that in Asia, the Sovereign is interested in the improvement and cultivation of land, and it is not impossible that it may have this effect in some degree, by leading him to extend the market as far as he can, by means of roads and navigable canals. But the tithe of the Church is divided into such small * [ Political (Economy , Book V. chap. xi. . Works, Vol. IV. pp. 283-298.] 247 CHAP. IV.— OF TAXES. (§ 3.) portions, that no one of the proprietors can have any interest analogous to this, and therefore its necessary inconveniences are not redeemed by any such indirect advantage. Taxes upon the produce of land may be levied either in ldnd , or, according to a certain valuation, in money. The former mode may be advantageous to the parson of a parish who can oversee, with his own eyes, the collection of what is due to him ; but would be necessarily attended with loss to a Sovereign, from the depreciations of his tax-gatherers. A tax upon the produce of land which is levied in money, may be levied according to a valuation which varies with the . market price ; or, according to some fixed valuation, (a bushel of wheat, for example, being always valued at one and the same money price, whatever the state of the market may be.) The produce of a tax levied in the former way, will vary only ac¬ cording to the variations of the real produce of the land. That levied in the latter way, will vary, not only according to the variations in the produce, but according to the value of the precious metals, and the standard of the coin. When a certain sum of money is to be paid in full compen¬ sation for all tax on produce, the tax becomes, like the land-tax of England. Such is the modus taken in lieu of tithes in many parishes ; and which, as it neither rises nor falls with the rent of land, has no tendency either to encourage or discourage improvement.1 [SECT. III.] — TAXES UPON THE RENT OF HOUSES. Another species of rent yet remains to be considered as an object of taxation ; I mean the rent of houses. This differs from a land-rent in one essential circumstance : that the former is drawn from an unproductive , the latter from a productive subject ; and, of consequence, the rent which is paid for the use of a house, must be derived from- some other source of 1 See what Smith says of the tithes in Bengal, — •[ Wealth of Nations , Book V. chap. i. ; Vol. II. p. 279, tentli edition, ] — and Francis’s observation quoted in Boyd’s Justice of Peace. 248 POLITICAL ECONOMY.— PART I.- — BOOK II. — NAT. WEALTH. revenue. In so far, therefore, as a tax upon house-rent falls on the inhabitants, it is one of those taxes which must fall indis¬ criminately upon all the three sources of revenue formerly mentioned, and is properly to be classed with the taxes imposed on consumable commodities. In treating of these , it will appear afterwards, that the general principle which has served to recommend them to modern statesmen is, that they afford the most practicable mode of taxing revenue, which it is scarcely possible to tax proportion¬ ally by any direct imposition. The revenue, it is supposed, will in most cases be nearly in proportion to the expense ; and the expense is measured by the consumable commodities on which it is laid out. This general principle applies with pecu¬ liar force to the subject now under consideration, as there is scarcely any one article of consumption which may be assumed with so great confidence, as a scale for estimating the whole expenditure of an individual. A proportional tax on it might (in Mr. Smith's opinion) produce a more considerable revenue than has been hitherto drawn from it in any part of Europe A’ Ground-rents (although they have hitherto not been sub¬ jected in any country of Europe to a separate tax) are a still more proper object of taxation than the rent of houses. Such a tax would fall altogether upon the owner of the ground-rent, (who may always be presumed to be actuated by the spirit of monopoly,) and would have no effect to raise the rent of houses, the inhabitants of which, even although they should advance the tax in the first instance, would indemnify themselves by the fall in the ground-rents which the tax would necessarily occasion. Another consideration strongly recommends this species of revenue as a fit object of taxation, that it is enjoyed without any attention exerted on the part of the owner, and depends almost entirely on local causes connected with the general administration of the country. In this respect, it is distin¬ guished from the ordinary rent of land, which depends, partly at least, on the good or bad management of the landlord. * [ Wealth of Nations, Book V. chap. ii. ; Yol. III. p. 285, tenth edition.] CHAP. IV. — OF TAXES. (§ 4.) 249 [SECT. IV.] — TAXES UPON PROFIT, OR UPON THE'REVENUE ARISING FROM STOCK. [subsect. i. — Taxes upon Profit in General .] The revenue arising from Stock divides itself into two parts ; (1.) that which pays interest to the owner of the stock ; and, (2.) that which is over and above what is necessary for paying the interest. Of these two parts of Profit the latter is evidently a subject not taxable directly. It is a compensation for the risk and trouble of employing the stock, and which, if the employer did not receive, he would discontinue the employment. If he was taxed directly in proportion to the whole profit, he must either raise the rate of profit, or pay less interest. In the former case, the tax would be finally paid by the landlord or by the con¬ sumer, according as the Stock was employed in farming or in mercantile speculations. In the latter case, the tax would fall on the interest of money. At first view, the interest of money would seem to be a sub¬ ject as fit for direct taxation as the rent of land ; but two circumstances create a wide distinction between them: — (1.) The quantity and value of the land which any man possesses can never be a secret, whereas the whole amount of his capital can scarce ever be exactly ascertained, and, if it could, would be found liable to continual variations. — (2.) Land is a subject which cannot be removed, whereas Stock easily may. A tax, therefore, which tended to drive away stock from any country, would tend to dry up every source of revenue. The profits of stock, the rent of land, and the wages of labour would be dimi¬ nished by the removal. Hence, the loose manner in which stock is estimated by those nations, who have attempted to tax the revenue arising from it. In England, for example, it the greater part of the lands are not rated to the land-tax at hall their actual value, the greater part of the stock is scarce rated at the fiftieth part of its actual value. Nor, indeed, is it possible that such a tax can be levied according to any estimate ap- 250 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. proaching to the truth, without so severe an inquisition into the circumstances of individuals, as would be inconsistent with the manner and spirit of a mercantile country. [subsect, ii.] — Taxes upon the Profit of Particular Employments. The taxes on Profit , which we have been now considering, are supposed to be levied on it merely as arising from Stock , without any regard to the manner in which it is employed ; besides these, however, it has been the policy of some countries to impose extraordinary taxes on the profits which particular employments of stock produce ; sometimes on the profits de¬ rived from particular branches of trade, and sometimes on those arising from agriculture. Of the former kind are, in England, the tax upon hawkers and pedlars, that upon hackney-coaches and chairs, and that which the keepers of ale-houses pay for a license to retail ale and spirituous liquors. A tax upon the profits of stock must always fall finally upon the consumers, and if it is proportioned to the trade of the dealer, occasions no oppression to him. When it is not so proportioned, but is the same upon all dealers, though, in this case, too, it is finally paid by the consumer, yet it favours the great, and occasions some oppression to the small dealer. The tax known under the old French Government by the title of the Personal Taille , affords the most remarkable in¬ stance that has occurred in modern Europe, of a tax upon the profits of stock employed in agriculture. During the disorderly period when the Feudal Government subsisted in vigour, the great weight of taxation fell on those whose weakness left them at the mercy of the sovereign. Hence the taxes which, in some countries, were confined to lands held in property by an ignoble tenure, and which, in others, were laid on the supposed profits of all those who farmed lands belonging to other people, whatever might be the tenure by which the proprietors held them. In the former case, the taille was said to be real , in the latter to be personal. 251 CHAP. IY. — OF TAXES. (§ 5.) Examples of botli were to be found under the monarchy of France, and they are both liable to strong objections, although, of the two, the latter is by far the most unjust and oppressive. When a tax is imposed on the profits of stock in a particular branch of trade, the traders are careful that the tax should fall on the consumer. But when a tax is imposed on the profits of stock employed in agriculture, it must fall finally upon the landlord. The more the farmer is obliged to pay in the way of tax, the less he can afford to pay in the way of rent. Although, therefore, a tax of this kind, imposed during the currency of a lease, may distress or even ruin the farmer, it must always fall upon the landlord when the lease is renewed. In countries where the personal taille takes place, the farmer is commonly assessed in proportion to the stock which he appears to employ in cultivation. He therefore cultivates with the most wretched instruments of husbandry that he can, — a mis¬ taken policy, no doubt, on his part, in many instances, but re¬ sulting naturally from the circumstances in which he is placed. The consequence is, that cultivation is discouraged, to the pre¬ judice, more or less, of the husbandman himself, of the landlord, and of the public. For an examination of the other classes of taxes formerly mentioned, I must content myself with referring to Mr. Smith.* In the prosecution of the subject, my plan was to state the results of the speculations of those writers whose opinions have had, of late years, the greatest practical influence on the financial operations of this country. But this is a subject far too extensive for me to undertake at present. [SECT. V. — CONCLUSION.] In the course of the foregoing review of different taxes, I have stated the most important results of the speculations of those writers whose opinions have had, of late years, the greatest practical influence on the financial operations of this country. From what has been said, it would appear that taxes on con- ** | Wealth of Nations , Book V, chap, iii.; Yol. TII. pp. 311-394, tenth edition.] 252 POLITICAL ECONOMY. — PART I. — BOOK II. — NAT. WEALTH. sumption are recommended by very peculiar and weighty advantages : — 1. Money1 is thus drawn into the Exchequer out of the pocket of the subject without his perceiving it, the tax being blended with the price of the commodity. 2. Taxes on consumption are, in some measure, voluntary, as a man may choose how far he will use the commodity which is taxed. 3. Every extension of this species of tax has a tendency (at least within certain limits) to create a new ability in the subject to defray it ; for when a tax is laid upon goods consumed by the mass of the people, it more frequently happens that the poor increase their industry so as to add to the wealth of the coun¬ try, and create a fund for defraying the tax, than that they retrench their living to their own and the public detriment, or raise their wages, so as to make the burden fall upon the rich. It has been further urged in favour of this description of taxes, that they have the exclusive merit of rectifying their own excesses, — inasmuch as, when pushed to an extreme, they encourage smuggling, and produce a deficiency in the revenue.2 Among the most zealous advocates for taxes on consumption are Eecker, the Marquis de Casaux, and Mr. Young. The last two writers go so far as to assert, that they should be substituted instead of the land-taxes of France and of Eng¬ land.3 On the other hand, it cannot be denied, that taxes of this nature are liable to strong objections, on account, — 1. Of the extreme expense of collecting them ; — 2. Of the severe restraints on trade as well as liberty, which the collection of them renders necessary ; — and 3. On account of their tendency to hurt foreign trade by enhancing the price of commodities. In this country, in particular, where this system has been already carried to a very great extent, it seems now to be generally admitted, that it cannot be trusted to as a means of supplying so large a revenue as is required, when we attempt to raise a war supply without 1 Lauderdale’s Pamphlet; Young’s the same side of the question in Young’s Prance. France, p. 523. 2 See some further considerations on 3 Young, p. 530. CHAP. IV. - — OF TAXES. (§ 5.) 253 borrowing. In a country, when a small and moderate revenue is to be collected from a people in a state of increasing pros¬ perity, the objections just now mentioned may be more easily obviated. In order to levy so immense a sum as the exigencies of Government now require, recourse must be had to taxes affect¬ ing directly the fortunes of the contributors. But how such a tax is to be imposed Is a different question, — and a question of very difficult solution. The consideration of it, it would be obviously improper for me to introduce in this place. A late writer (and one, too, whose political views are understood to be extremely favourable to the existing Administration of Great Britain) has employed his ingenuity in an attempt to revive the project of a territorial tax on the plan of the French Economists. But on this idea, which is not very likely to attract much attention in this country, it would be superfluous for me to enlarge at present, more particularly, as I propose to examine afterwards, at some length, the arguments which have been offered both for and against it. I shall also pass over, without examination, another project of taxation, which has been lately carried into effect in Great Britain, — I mean the tax upon income , as I am always un¬ willing to touch upon any questions which are collected with the political discussions of the times. The arguments, besides, which have been alleged on both sides, cannot fail to be fresh in the recollection of all my hearers. Two other projects, which are not so generally known, de¬ serve to be mentioned, on account of the ingenuity and ability with which they have been recommended to the notice of the public. The first (which was published in 1795) is explained in a Pamphlet by Mr. Bentham, entitled Supply without Bur¬ then , or Escheat vice Taxation , &c. The other is of a very late date, (having appeared in the course of the present year,) and has for its object to “ impose a tax in perpetuity on all property, entailed or unentailed, settled or unsettled, the enjoy¬ ment of which passes by succession,” [its title being, Hints towards an Improved System oj Taxation , Pc. 1/99. | [BOOK THIRD.] [OF THE POOR— THEIR MAINTENANCE.] ( Interpolation from Notes.) — Having been employed, for some time past, in tracing the sources of national opulence, our attention is naturally directed, in the next place, to that unfor¬ tunate class of men, who, in consequence either of the imper¬ fections of our social institutions, or of the evils necessarily connected with the present constitution of humanity, are left dependent on the bounty of their fellow-citizens. The subject is sufficiently interesting in itself, considered in relation merely to the order of men who are its immediate objects ; but it will be found, on examination, to be still more interesting when considered in connexion with the general system of Political Economy. In treating of this subject, I shall begin first with a short historical sketch of the origin and progress of the Poor- laws in both parts of the island, and shall afterwards proceed to some inquiries and speculations of a more general nature. [CHAPTER L] [HISTORICAL SKETCH OF THE POOR-LAWS.] [SECT. I. — OF THE ENGLISH POOR-LAWS.] From the review which I am now to offer, it will appear with what extreme difficulty this branch of legislation is accom¬ panied, and how frequently the best intended, and, apparently, most wisely- concerted schemes have been found to aggravate the evils which they were meant to remedy. Such a review, CHAP. T. — HISTORICAL SKETCH OF THE POOR-LAWS. (§ 1.) 255 while it serves to animate our wishes for the improvement of what is defective or erroneous in the established system, will be no less useful in moderating our confidence in the most plausi¬ ble plans that may he proposed with that view. For the same reason, I shall not be very forward in suggesting any ideas of my own on this subject. I shall aim rather at giving a useful direction to your future inquiries, contenting myself at present, with remarking, in general, the striking illustration which this subject affords of the danger of multiplying unnecessarily the objects of law, by attempting to secure artificially, by the wisdom of man, those beneficent ends which are sufficiently provided for by the wisdom of nature. But it is not to those alone who study Political Economy, with a view to the improvement of the theory of legislation, that this is an interesting subject of speculation. Every indi¬ vidual in a private capacity, is daily induced by the impulse of compassion to administer assistance to the indigent, and needs some general principles to guide his benevolence, without which he may be in danger of counteracting the purposes which he wishes to serve. I have no doubt that the want of these pre¬ vents many from doing the good, which they would be both willing and able to do, if they had some fixed and acknowledged rule of conduct. Nor is this at all surprising ; for there is cer¬ tainly none of the private offices of duty in which men have been more misled from the general advantage of society, by false and partial views, than in the administration of individual charity. To the justness of this remark, every country of Europe bears witness, in the numberless establishments founded in the dark ages, by the pious charity of individuals. In the present times, however, the charity both of individuals and of the State ought to be regulated by views of general and permanent interest, not by any view of partial or temporary advantage. I had formerly occasion [supra, Yol. I. p. 113] to take notice of the servile condition of the lower orders of men all over Europe, for a long time after the settlement of the barbarous nations in the different Roman provinces ; and more particu- 256 POLITICAL ECONOMY. — PART I. — BOOK III. — OF THE POOR. larly, I observed, that daring the eighth, ninth, and tenth cen¬ turies, slaves seem everywhere to have formed the most numerous rank in the community. While this continued to be the case, that order of men which is called the begging poor, could not have an existence. The obligation to serve another for life, im¬ plies a reciprocal obligation on the master to supply his slave with the necessaries of life ; and a regard to his own interest will usually secure the fulfilment of this obligation, though in times of general scarcity it is possible that the labouring classes may be exposed to severe hardships. It is hardly necessary for me to remark here, that this consideration does not lead to any conclusion favourable to the institution of slavery, which opposes a great and almost insurmountable barrier to the opulence and population of a country. The number of individuals to whom it secures the bare necessaries of life, bears no proportion to those who, under a more liberal system of policy, would have enjoyed many of its comforts and accommodations. Where all men have the prospect of bettering their condition, we may expect to find some unfortunate adventurers ; and although it will always be the object of a wise Legislature to diminish the num¬ ber of these, yet the existence of indigence and of those other calamities which are its usual concomitants, may be regarded as a decisive proof that the labouring orders have already emancipated themselves from the tyranny of their domestic masters, and that they have entered on that career which is gradually to raise them to a more elevated rank. This reflection, while it furnishes a satisfactory answer to those arguments in favour of the African slave trade, which are founded on a comparison between the situation of the begging poor in Great Britain, and that of the negroes in our WTest India colonies, may serve to reconcile us to those partial evils which appear to be the inseparable attendants of national opu¬ lence ; not that I would willingly grant in its fullest extent the truth of the remark on which these observations proceed. It does not belong to the present subject to trace the various steps by which the practice of villanage gradually wore out in England. One circumstance, unquestion ably, which contri- CHAP. I. — HISTORICAL SKETCH OF THE POOR-LAWS. (§ 1.) 257 buted very powerfully to tlie rise of the lower orders, was the endeavours of the different sovereigns from Henry II., to counterbalance the overgrown weight of the feudal aristocracy, by encouraging the manumission of bondsmen, and taking the towns under their protection. This policy was pursued with great steadiness by Edward III. during his long and vigorous reign ; nor was it abandoned under the feeble administration of his successor, Eichard II. It seems, indeed, to have been in the course of this last reign that the most general emancipation of bondsmen took place. This sudden emancipation of the lower orders, produced the consequences which might have been expected. Eestored all at once to their natural rights, without being sufficiently pre¬ pared for liberty, they felt an impatience of all legal restraint. ISTor was it in the power of any laws, however rigorously executed, to correct these disorders, at a period when the arts and manufactures furnished employment to so very small a proportion of the people. These consequences were felt even during the reign of Edward III., and still more under the weak administration of his successor, in whose time, we find in the records of Parliament, numberless complaints of the vagrants, rogues, and deserters of their service, who were wandering over the country doing mischief, &c. In 1376, the year before Edward’s death, the Commons made a great complaint, that masters were obliged to give their servants great wages, in order to prevent them from running away ; that many of them who left their service became sturdy beggars, who infested the king¬ dom, &c. ; to remedy which evils, they proposed “ That no relief should be given to those who are able to work, within boroughs or in the country; that vagrant beggars, and staff-strikers, should be imprisoned till they consent to return home to work ; and that whoever harboured any runaway servant in his service, should be liable to a penalty of £10.,;;I: It does not appear that the King assented to this proposal ; but, as Sir Frederic Morton Eden observes, it seems to have been the groundwork of a subsequent statute, and shows the early opinion of Parliament * [Eden’s State of the Poor, 171)7, Book I. chap. i. ; Yol. I. p. 42, seq.] VOL. IX. 258 POLITICAL ECONOMY. — PART I. — BOOK III. — OF THE POOR. on the subject of mendicity. It is in this statute that beggars are first mentioned ; and from the language used, they appear chiefly to have lived in towns and burghs, where the principal part of the national wealth was concentrated. Of the progress which these evils rapidly made, some idea may be formed from a statute passed at the commencement of the subsequent reign, (1st Richard II.) By this Act, the excesses of the villains were repressed by severe punishments, their farther emancipation checked, and every method employed by the great barons to prevent others from becoming free ; insomuch, that in the fifteenth year of Richard II., they endeavoured to obtain a law, that no villain should be allowed to send his son to school ; a memorable instance of that short-sighted policy, not without its influence, alas, in our own times, which attempts to preserve the order of society by withholding from the people those means of intellectual improvement which alone lay a sure foundation for good morals, and peaceable subordination to authority. It was during this reign that the Legislature found itself first called upon, not only to provide for the punishment of vagrants, but also for the relief of the aged and impotent. In earlier times, it may be presumed, that the villain, when unable to work, was maintained by his lord, as the pauper now is by his parish ; and as the number then engaged in manufactures was comparatively small, there is great reason to believe that the indigent workmen were supported from the funds of the corporation or society to which they belonged. By the statute 1388, among a variety of other regulations, it is enacted, “ That impotent beggars should continue in the cities or villages where they lived at the time of the passing of the Act ; and if the inhabitants of those places were neither able nor willing to maintain them, they were to be taken to other towns within the hundred, or to the place of their birth, where they were to continue for life.”* From the language of this statute, Sir Frederic Eden argues, ic I should infer that the district where impotent beggars were directed to reside, was bound to maintain them ; and that the justices of peace, who had a considerable '* [Ibid. p. 44.] CHAP. I. - HISTORICAL SKETCH OF THE POOR-LAWS. (§ 1.) 259 latitude of discretionary power, in some cases regulated both the place of their abode, and the amount of the alms they were to receive.”* These details may appear minute and tedious, but they form a very important part of this historical sketch, as they show that the great outlines of a scheme for the compulsory main¬ tenance of the poor, which is commonly believed to have originated in consequence of the Protestant Reformation, had been conceived as early as the reign of Richard II. The Act, too, was confirmed in the reign of Henry IV. During the subsequent reigns, various regulations were enacted, by the Legislature, by which the harsh provisions of former statutes against vagrants were somewhat moderated ; and at last, in the reign of Henry VIII., they received the sanction of an express statute. The Protestant Reformation, with some other events immediately connected with it, in particular the suppression of the monasteries by Henry VIII., had a powerful influence on the condition of the lower orders in general, and tended greatly to increase the number of the begging poor. Hot to mention the multitudes whose subsistence depended on the alms distributed at the gates of the religious houses, and who, in consequence of their suppression, were thrown at once on the bounty of their fellow-citizens, 50,000 monks were com¬ pelled to have recourse to the active exertions of industry, and reduced to the same state of dependence and indigence. The first effects, too, of this violent and arbitrary measure on the general industry of the country, must have been far from favourable. Instead of the gentle dominion of the abbots who, with all their vices, seem to have been kind and indulgent landlords, and who, in consequence of the great hospitality which they exercised at home, consumed the greater part of the produce of the land on the spot, the people found them¬ selves exposed to the extortions of new masters, who spent their revenues in the capital, and to the still more intolerable rapacity of their stewards. <£ Old Henry Jenkins lamented, with reason, that the days were over in which he used to be * [Ibid. p. 61.] 260 POLITICAL ECONOMY. — PART I. — BOOK III. — OF THE POOR. invited to tlie Lord Abbot's chamber, to feast on quarters of a yard of roast beef, and wassel in a black jack : he was probably not the only sufferer.”* And though it certainly was not de¬ sirable that the great luxury of the monks should have been perpetual, yet it cannot be doubted that the violence with which the remedy was applied, must have disordered, for a considerable time, the general police of the country. A prohi¬ bition against admitting novices in future, would have been an equally effectual preventive, and would have saved that injustice and cruelty with which the measure was actually carried into execution. When I mention the Protestant Eeformation, and the sudden suppression of the monasteries, as one cause of the increase of the begging poor, I would not be understood to admit with some advocates of the Boman Catholic faith, that during the Popish times beggary was attended with no inconveniences to the community in general, the burden falling exclusively on the religious houses. Abundant evidence of the contrary is afforded by the facts already stated. The following document, however, is so curious, that I shall make no apology for subjoining it as an additional confirmation of the same thing, more especially as it will serve to illustrate the unreasonableness of certain other popular clamours which have been renewed in our own times. It is an extract from Lewis's History of the several Translations of the Holy Bible , [1731,] and evinces completely the disorders which existed in England, in consequence of the prevalence of beggary, even when the Popish institutions sub¬ sisted in all their vigour. The passage, at the same time, it sufficiently appears, is exaggerated in some of its statements, as well as unfounded in some of its inferences, being the composi¬ tion of a warm advocate for the Beformed faith, at a period when the minds of men were too much heated to judge, or even to observe, with coolness. “ Before I proceed to give an account of the next edition of the English Bible , it may not, perhaps, be wholly unacceptable to the reader, to observe to him an historical passage in the * [Ibid. Book I. chap. ii. ; Vol. 1. p. 97.] CHAP. I. — HISTORICAL SKETCH OF THE POOR-LAWS. (§ 1.) 261 Preface of Cover dale’s, to the Bible just now spoken of, relat¬ ing to the increase of the poor here in England ; and that the rather, because of the pompous boasts made by the Romanists of their charity, and the hard reflections made on us by them for the want of it, as if the great number of beggars were owing to the Reformation, and particularly to the dissolution of the religious houses, as. the monasteries were falsely called, at whose gates a professed Protestant tells us, all the poor of the nation were supported. But now Coverdale here appeals to the senses of his reader, and bids him lift up his eyes and see how great a multitude of poor people runne thorowe every towne : and this, too, at a time when these religious houses were at the very height of their prosperity. Sir Thomas More speaks of people’s going about sick of the French pox and beg¬ ging with them, though he adds, 6 that thirty years ago there were five against one that begged with them now.’ In his Utopia he proposed, e That the beggars should, by a law made on purpose, be all placed in the convents of the Benedictines, since it was owing in a great measure to the avarice of these wealthy abbeys, who laid down their arable lands to pasture, that the number of beggars was so much increased.’”* That I may not lose myself in a field of such immense extent as this, I shall pass over the various attempts of the Legislature to secure a maintenance to the impotent, and em¬ ployment to the idle part of the community, during the reigns of Edward VI. and of Philip and Mary, and shall proceed at once to the Act for the relief of the poor, passed in the year 1601, in the forty- third year of Queen Elizabeth’s reign ; which, having concentrated all the former laws relative to this subject, has remained the foundation-stone of our present establishment. The most important provisions of this Act were copied ver¬ batim from an Act passed a few years before, by which four overseers were directed in each parish, to take measures for setting poor children and persons, in want of employment, * [Chap. ii. pp- 100-102, third edition.] 262 POLITICAL ECONOMY. — PART I. — BOOK III. — OF THE POOR. to work, and for raising a stock of materials for tliat pur¬ pose, &c. As the distresses of the poor, in consequence of the scarcities which prevailed towards the conclusion of the last and begin¬ ning of the present century, have engaged a more than ordinary degree of attention in our times, particularly among speculative men, it may not he altogether useless for me to remark here the extreme danger of being hurried, by the pressure of acci¬ dental or temporary evils, into measures which may entail permanent and incorrigible mischiefs on the community. The consequences of the Act 1601 in England, during the last two centuries, have been long and deeply deplored ; and they are now so interwoven with the general system of English pro¬ sperity, that it is hardly possible to conceive how they can be effectually remedied. And yet there are, I think, strong rea¬ sons for believing that this fatal Act arose entirely from the severe hardships under which the poor had laboured for some years previous to its date. An uninterrupted course of scanty seasons and unfavourable crops closed the sixteenth, as it has since done the seventeenth and eighteenth centuries ; and an examination of the state of the country at the end of the first of these periods, may not be uninstructive to many persons even in the present times. “ In 1587, wheat rose to £3, 4s. the quarter; in 1594, it was £2, 16s. ; and in 1595, £2, 13s. the quarter. — Blome- field, in his History of Norfolk , informs us, that the scarcity of Norwich in the year 1595, was so great, that the magis¬ trates were obliged to send for a large quantity of rye from Denmark ; but the winds hindering its coming, the project was of no service till late in the year. When it arrived, it was sold to the poor at the reduced price of 4s. the bushel. This charitable act cost the corporation above £200. 1 subjoin Blomefield's account of the prices of several other articles of diet at Norwich this year, as it corroborates the assertions Af other historians respecting the dearth of this period: wheat was £2 the quarter ; rye, £1, 10s. ; barley, £1 ; oatmeal, £2 ; beef, 3s. the stone ; the best sheep, 14s. a piece ; a lamb, 5s. ; CHAP. I. —HISTORICAL SKETCH OF THE POOR-LAWS. (§ 1.) 263 a calf, £1 ; a fat capon, 3s. 4d. ; a pigeon, 3d. ; a rabbit, 8d. ; and cheese, 4d. the pound. BlomeMd adds, that in the be¬ ginning of 1596 prices fell ; ‘ but by reason of a wet May, they rose again to such large prices that it was a very hard year with the poor, and so continued to the next harvest, when, by God’s mercy, things fell, on account of their plenty, to their usual prices/”* In 1601, when the Act in question was passed, the crop was plentiful, and the seasons continuing favourable for a series of years, the situation of the poor became comparatively easy, and the Legislature exulted in the happy consequences of its own foresight. It appears, however, from D’E wes’s Journal that there were a few members who had the sagacity to per¬ ceive, that the only permanent foundation for plenty was to be laid in a prosperous agriculture. In the debate on the pro¬ priety of continuing the Statute of tillage, a Mr. Johnson made a speech, the substance of which is thus reported by D’Ewes : — “ In the time of dearth, when we made this Statute, it was not considered that the hand of God was upon us ; and now corn is cheap ; if too cheap, the husbandman is undone, whom we must provide for, for he is the staple man of the kingdom.” f Another speaker who rose above the prejudices of his age, was Sir Walter Raleigh, who, in the course of the same debate, recommended as the most effectual plan for securing the per¬ manent prosperity of the nation, to set tillage at liberty. With respect to the comparative number of the receivers and payers of parochial contributions, immediately after the esta¬ blishment of the poor’s-rates, it is impossible for us, at this distance of time, to form any accurate estimate. But it seems highly probable, as Sir Frederic Eden observes, J that the num¬ ber of poor receiving or wanting parish relief, at the close of the sixteenth and beginning of the seventeenth century, bore a less proportion to the other classes of the nation than the number of those in similar circumstances does at present. * [Eden’s State of the Poor , Book I. cliap. ii. Vol. I. p. 134.] -f- \ Journal , p. 674.] | [State of the Poor, Book I. cliap. ii. Vol. I. p- 133.] 264 POLITICAL ECONOMY. — PART I. — BOOK III. — OF THE POOR. About the year 1590, the city of London is said to have con¬ tained 160,000 inhabitants. In the year 1595, a year of great scarcity, a survey was made, by direction of the Lord Mayor, of the number of poor householders, who were found to amount to 4132. But it is not mentioned whether the individuals in each family were included in this enumeration, or what class of persons was understood to fall under the denomination of householders. Making, however, a very full allowance for these omissions, we shall be justified in supposing, that the increase of the inhabitants of the metropolis has by no means kept pace with the increase of the poor. The legal assessments and voluntary contributions now raised in London for relief of the poor, together with the expense of the many beneficent esta¬ blishments and public charities which it contains, are estimated by Mr. Colquhoun, who published in the year 1797, at £850,000 per annum* And the same author asserts, in an¬ other part of his work, “ that upwards of 20,000 individuals rise every morning in London, without knowing how, or by what means, they are to be supported during the day, or where, in many instances, they are to lodge on the succeeding night."' f If we examine the condition of many of our country towns, even of those which are considered as the most advanced in opulence and industry, we shall find the proportion of the poor far exceeding anything noticed in the reign of Queen Elizabeth. Of the amount of the rate annually levied during her reign, and during that of her successor, James I., history is silent. But we know that after the passing of this Act, the situation of the poor is represented as extremely deplorable. The assess¬ ments are said to have been so low, that many perished for want. During the reign of Charles I., the Legislature were too much occupied in discussing questions of a political and constitutional nature, to attend to the internal police of the country : accordingly, little information is known with regard to the state of the poor, till the accession of Charles II. “ Of * [Treatise on the Police of the Metropolis , Chap. xiii. p. 358, seventh edition.] f [Ibid. Chap. xi. p. 313, seventh edition.] CHAP. I. — HISTORICAL SKETCH OF THE POOR-LAWS. (§ 1.) 265 the thriving condition of England during the short period of the Commonwealth/' says Sir Frederic Morton Eden, “ we have the concurrent testimony of several contemporary authors. The great increase of trade, high price of wool, and advance of rents about the year 1652, are indubitable proofs that industry and its attendant comforts had not deserted the land.”* In the year 1662, the important Statute which is the founda¬ tion of the present law of settlements, was enacted not only for the purpose of determining who were to be considered as the poor of each parish, but to prevent labourers in general, even before they became actually chargeable from wandering from the usual place of their abode, lest particular parishes, which, from their situation, held out inviting prospects to the industrious, should, in the end, be overburdened with their poor. Previous to the passing of this Act, the poor were at liberty to seek employment wherever it could be had ; and none were obliged to reside in the place of their settlement, this place of settlement being fixed by an abode for three years. But by the 13th and 14th of Charles II., it was enacted, that the residence in a parish necessary in order to receive a settle¬ ment should be reduced to forty days ; and that within that time it should be lawful for any two justices of the peace, upon complaint made by the church-wardens and overseers of the poor, to remove any new comer to the parish where he was last legally settled, either as a native, householder, sojourner, ap¬ prentice, or servant, for the space of forty days at the least.” f I have mentioned this Act thus particularly, because, accord¬ ing to Sir Frederic Eden, the single clause now quoted from this short Act, has occasioned more doubts and difficulty in Westminster Hall, and he adds, has been more profitable to the lawyers, than any other part of English jurisprudence. J It has been justly remarked of it, that it is deficient with legal d to the subjects of foreign nations. Scotch and Irish labourers, for instance, if they do not fall under the class of vagi ants, could not be removed under its provisions, because they nevei •* [State of the Poor , Book 1. chap, ii- ; "Vol. I. p. 171. | f [Ibid. p. 175.] t tIbid- P- 176-1 266 POLITICAL ECONOMY. — PART I. — BOOK TIL — OF THE POOR. could, become chargeable. However, as they might and still may continue undisturbed, without the entanglement of a cer¬ tificate ; and if they cannot secure a claim for themselves, as they yet can establish one for their children, servants, and ap¬ prentices, they were, in this respect, placed in a better situation than the natives. — This glaring defect in the Act, rendering strangers the only persons capable of residing in any part of England which they chose, has at length happily been corrected ; and English labourers are now, by the 35th George III., autho¬ rized to remain in any place till they become actually charge¬ able. Some inconveniences are stated as consequences of this Statute, equitable and liberal as it appears, in a Pamphlet by Mr. Bates Dudley, published in the year 1802.* The obstruction which this law of settlement opposes to the free circulation of common labour, has been justly called by Mr. Smith, tc the greatest of all the disorders in the police of England/' Of the rise, progress, and state of the evil at the time when he wrote, a succinct account will be found in his W ealth o f Nations . f According to Mr. Smith, the very unequal price of labour which we frequently find in England in places at no great dis¬ tance from one another, is probably owing to the obstruction which the law of settlements gives to a poor man, who would carry his industry from one parish to another without a certifi¬ cate/' J And to the same purpose, Lord Karnes, in his Sketches of the History of Man , observes, that while in Scotland the price of labour is generally the same in the different shires and parishes, “ it varies in every parish of England. A labourer who has gained a settlement in a parish, on which he depends for bread when he inclines to be idle, dares not remove to an¬ other parish where wages are higher, fearing to be out of a settlement altogether." § The assertions of these two very respectable writers concerning the uniformity in the rate of * [Observations on the Present State ± [Ibid. p. 218.J and Defects of the Poor-Laws .] + [Book I. chap. x. ; Yol. I. pp. 212- § [Book IT. Sketch x. ; Vol. II. p. 40, 222, tenth edition.] edit. 1774.] CHAR. I. — HISTORICAL SKETCH OF THE POOR-LAWS. (§ 1.) 267 wages over Scotland, compared with the state of England in the same respect, are controverted by Mr. Howlett, in his Examina¬ tion of Mr. Pitt’s Speech on the Poor-laws , [1796 ;] and Sir Frederic Eden has given it as his opinion, that Mr. Howlett’s censures are justified by an appeal to facts. “ I am persuaded,” says Mr. Howlett, “ that had the Doctor lived to have read Sir John Sinclair’s Statistical Account of Scotland, he would perhaps have been inclined to some slight alteration of senti¬ ment. He would have discovered that the price of labour is as various in the northern part of Great Britain as in the southern, and the slightest view of our towns of Leeds, Liverpool, and in¬ numerable others, might have convinced him that the circulation of labour is as free , and the scarcity of hands in one place as amply supplied by their superabundance in another , on the south side of the Tweed as on the north.”* And to the same purpose, Sir Frederic Eden asserts, in terms still stronger, that “ neither of these writers seems to be warranted by fact in their supposition, that the price of labour, in their own country, is far more equal than it is in England ; and that the in¬ equality here is principally occasioned by the obstruction which the law of settlements gives to a poor man, who would carry his industry from one parish to another without a certificate.” f I cannot help thinking, that both of these gentlemen have gone too far in their censure on our Scottish politicians. With¬ out entering into any particular discussion of facts, wre have decisive evidence, I think, against these conclusions. It seems to be one of the most incontrovertible positions which can be imagined, that the law of settlements, though not the only cause of the inequality which prevails in England, must in¬ crease that inequality ; and that when it is once established, it must oppose an almost insurmountable barrier to the operation of those natural causes which tend gradually to bring down the rate of wages to a level. On the other hand, it is most un¬ doubtedly true, that in Scotland the uniformity of wages is not so complete as we might expect from a theoretical view ol the * [Examination of Mr. Pitt's Speech, &c., Sect. 1. pp. 15, 16.J n. + [State of the Poor , Book I. chap. ; Vol. 1. p. 181.J J 268 POLITICAL ECONOMY.— PART I. — BOOK III. — OF THE POOR. subject ; and it must, perhaps, be granted, that the language employed by Lord Karnes is too general and unqualified. But this only amounts to a proof of what Mr. Smith says in an¬ other part of his work, that “ after all that has been said of the levity and inconstancy of human nature, it appears evi¬ dently from experience, that a man is, of all sorts of luggage, the most difficult to be transported. If the labouring poor, there¬ fore, can maintain their families in those parts of the kingdom where the price of labour is lowest, they must be in affluence where it is highest/'* At the time when Mr. Smith wrote, ten- pence was the current price of a day's labour in Edinburgh and its neighbourhood, and at a few miles distance eightpence, which he considers as the common price of labour in the greater part of the low country of Scotland, where it varies a good deal less than in England. “ Such a difference of prices, which it seems is not always sufficient to transport a man from one parish to another, would necessarily occasion so great a tran¬ sportation of the most bulky commodities, not only from one parish to another, but from one end of the kingdom, almost from one end of the world to the other, as would soon reduce them more nearly to a level.” f But the influence of these local attachments is common to both parts of the island, and cannot possibly produce so great an effect when it operates alone, as when other causes concur of a still more uncontrollable and universal efficacy. I shall only add farther on this subject at present, that the inequalities in the wages of agricultural labourers are increased, in both parts of the island, by a circumstance which I had occasion to illustrate in a former part of the course. J I mean the slow circulation of agricultural knowledge, arising from the peculiarly obstinate prejudices of this order of men, in conse¬ quence of which, striking inequalities in the state of improve¬ ment may be remarked by the most careless observer, even in contiguous districts. Hence corresponding inequalities in the * [Wealth of Nations, Book I. chap. i [Supra, Political Economy, Vol. I. ; viii. ; Yol. I. p. 113, tenth edition.] ( Worhs, Yol. VIII.) p. 181.] t [Ibid.] CHAP. I. — HISTORICAL SKETCH OF THE POOR-LAWS. (§1.) 269 skill and industry of agricultural labourers in the same neigh¬ bourhood, and an effectual check to the operation of those causes which seem to promise, in theory, a speedy reduction of wages to one general level. Whatever opinion, however, may be entertained on this sub¬ ject, every person must assent to the strong terms in which Mr. Smith has reprobated the law now under consideration. “ To remove a man, who has committed no misdemeanour, from the parish where he chooses to reside, is an evident violation of natural liberty and justice. . . . There is scarce a poor man in England of forty years of age, I will venture to say, who has not, in some part of his life, felt himself most cruelly oppressed by this ill-contrived law of settlements.”* I find, indeed, that this fact is controverted by Mr. Howlett, who contends, in his Examination of Mr. Pitt’s Speech, that the law of settlements has no effect in this way at all. But in this particular, Mr. Smith's statement is supported by the testimony of so many respectable writers, that it is impossible to call its accuracy in question. Sir William Young, who is extremely well informed on such subjects, asserts positively, that the prosecutions occur¬ ring on this law are frequent. f Some of these remarks may appear, at first view, to be foreign to the subject which introduced them. As, however, the poli¬ tical disorder to which they relate has been the necessary con¬ sequence of the compulsory maintenance of the poor, and can only be effectually removed by an alteration of that principle, they will not, I hope, be considered as forming a useless or improper digression. In the period immediately subsequent to this regulation, few alterations were made on the existing laws with regard to the poor. The war which engaged the attention of the nation during the first eight years of King William’s reign, the for¬ midable preparations made by France to invade England, and the actual invasion of Ireland, together with the encourage¬ ment given to both by the dark and dangerous intrigues ot a * [ Wealth of Nations , Book I. cliap. t [See Eden’s State of the, Poor , Book x.; Yol. I. pp. 219, 220, tentli edition,] I- cliap. iii.; Vol. T. p. 397.] 270 POLITICAL ECONOMY. — PART I. — BOOK III. — OF THE POOR. powerful body of domestic malcontents, were very unfavourable to the removal of those abuses which had been accumulated by the neglect and misfortunes of half a century. About this time, indeed, some speculative men distinguished themselves by their attempts to draw the attention of the public to this important subject, among others, the celebrated Mr. Locke, who was then one of the Commissioners of the Board of Trade. A reference had been made to the Board of Trade in the year 1696, to con¬ sider of the proper methods to be adopted for employing the poor ; and it was in consequence of this reference that he drew up his Report [1697,] respecting their relief and maintenance, which was shortly after delivered to the King. The observations of this eminent philosopher and politician respecting the effects of the Poor-laws, deserve attention from all who wish to examine with accuracy the progress of English legislation in this depart¬ ment, more particularly as many of his suggestions appear to have formed the basis of a plan which, a few years ago, was under discussion, for amending the regulations of our parochial assessments. It is probable that a law framed upon his plan would have taken immediate effect, as the state of the poor had been recommended to the consideration of Parliament in the King’s Speech, the very year after the delivery of the Report, had not the public mind been too much agitated by the alter¬ cations which, about that time, took place between King Wil¬ liam and his Parliament, and which increased in violence during the latter part of his reign. In the reign of Queen Anne, few Acts were passed relative to the poor. But some important and original ideas were started on the subject by Daniel Defoe, in his excellent address to Par¬ liament, entitled, Giving Alms no Charity , (1705.) The reign of King George I. is equally barren of materials for our purpose. One Act, however, was passed during that reign, which deserves to be mentioned ; 9th Geo. I. Among other improvements of the existing laws, this Act provides that the church-wardens and overseers of the poor of any parish, with the consent of the majority of the parishioners, publicly given, may purchase or hire any house or houses in CHAP. I. — HISTORICAL SKETCH OF THE POOR-LAWS. (§ 1.) 271 the parish or place, and contract for the lodging, employing, and keeping of poor persons. Soon after the passing of this Act, many parishes availed themselves of the powers conferred by it ; and in a publication which appeared in the year 1725,* it is said that this method of maintaining the poor met with approbation and success throughout the kingdom. The same work was republished in 1732, with considerable additions, and in its enlarged state affords much curious information respecting workhouses. In consequence of the indefatigable zeal of the planners of this institution, the poor-rates are under¬ stood to have been considerably reduced in many instances. But from comparing the present state of those parishes in which workhouses were established with their condition seventy years ago, it would seem that the expectations of the nation, that great effects would have followed from the institution, have not been realized. From the view given in Sir Frederic Eden’s Treatise , of the state of those parishes which had erected workhouses, it appears that the poor had advanced very rapidly notwithstanding the aid of workhouses, perhaps as rapidly as in other parishes where they were supported by occasional assessments. f The way in which these workhouses, as at first established, effected a reduction in the poor-rates, was by deterring the poor from making application for relief, by the terror of being sent to a workhouse. Accordingly, Mr. Townshend, in his excellent Dissertation on the Poor-laivs , [1787,] says, that “ the terror ol being sent to a workhouse acts like an abolition of the poor’s-tax on all who dread the loss of liberty. It is in effect a virtual repeal, as far as it extends, of those laws which should long since have given place to better regulations. But, unfortunately, the most worthy objects suffer most by this repeal, and the advantage to the public is little more than negative. The quiet and the cleanly dread the noise and nastiness, even more than the con¬ finement of a workhouse. They pant for the pure and whole¬ some air, which they can never hope to breathe where numbers * [An Account of several Work- f [State of the Poor , Look I. chap. houses, &c.] ih". ; Vol. I. p. 270.] 272 POLITICAL ECONOMY. — PART I. — ROOK III. — OF THE POOR. are confined within narrow limits, and sigh for that serenity and peace which they must despair to find where the most profligate of the human species are met together. By the fear of being sentenced to such society, many who deserve a better fate struggle with poverty till they sink under the burthen of their misery.”* During the reign of George II. various attempts were made, both in and out of Parliament, to procure a radical alteration in the system of parochial administration, established by the 43d of Elizabeth. About the year 1753, in particular, this subject seems to have excited a very general attention, which, however, produced no material alteration on that branch of legislation to which it related. It is a curious circum¬ stance, that in the very same year, the same branch of police was under discussion among the French politicians; and most of these warmly recommended to their countrymen the English system of parochial assessments, at the very time when long experience of the inconveniences attending that system was producing a multitude of English pamphlets in praise of the French hospitals. Under the reign of our present Sovereign very few altera¬ tions have taken place, except with respect to removal ; the vexatious consequences of which will, in some measure, it is to be hoped, be remedied by the Act of 1795, for preventing the removal of persons who are not actually chargeable. Several local acts, however, have been passed of great importance to the places to which they relate ; and, indeed, there are some of these which may, without impropriety, be considered as general, rather than as local, regulations. Those, for instance, which relate to the improvement and correction of the Poor-laws within the city of London, may very properly be viewed in this light, as that is a district which contains a population equal to one- tenth of the whole inhabitants of the kingdom. The historical deduction now given, for the details of which I must acknowledge myself to be much indebted to the labours of Sir Frederic Eden, is sufficient, without any commentary, to * [Sect. xiii. p. 80, seq edit. 1817.] CHAP. I. — HISTORICAL SKETCH OF THE POOR-LAWS. (§ l.) 273 convey an idea of the imperfections of English legislation in this important article of Political Economy; and the rapid progress which the evil is daily making, seems to require the application of some immediate remedy. Towards the close of the seventeenth century, the amount of the rates exceeded £840,000 a year. This, at least, is the cal¬ culation of a writer, who, in 1673, published a work under the title of The Grand Concern of England explained , and which, I believe, is the earliest publication in which any attempt is made to compute the extent of this burden. u This,” he adds, “ is employed only to maintain idle persons ; doth great hurt rather than good ; makes a world of poor more than otherwise there would be ; prevents industry and laboriousness, men and women growing so idle and proud that they will not work, that lie upon the parish wherein they dwell for maintenance, apply¬ ing themselves to nothing but begging or pilfering, and breed¬ ing up their children accordingly ; never putting them upon anything that may render them useful in their generations, or beneficial either to themselves or the kingdom.”* In 1783, 1784, and 1785, the money raised by assessments in England and Wales amounted, taking a medium of these years, to £2,167,749, sterling, according to th e Report of the Committee of the House of Commons, founded on returns made by the overseers for the poor, in obedience to an Act passed in the year 1786. Sir Frederic Eden, whose work was published in the year 1797, states their amount at this time to be £3,000,000, sterling,! and adds, “ that they had doubled their amount in the course of the twenty years preceding.” J From the very accurate returns laid before Parliament, it appears, that exclusively of all collateral expenses, (for the militia, &c.,) raised at the same time with the assessments for relief of the poor, there had been raised, in the year ending Easter 180o, for the maintenance and relief of the poor, £4,257,000, being almost double the sum raised for the same purpose on an average of the years 1783, 1784, and 1785, and very nearly * [Quoted in Eden’s State of the Poor , Book I. chap. ii. ; Vol. I. p. 188.) VOL. IX. f [Ibid. Book I. chap. ii. ; Vol. I. p. 131.] $ [Ibid. Brel', p. xxv.| S 274 POLITICAL ECONOMY. — PART T. — BOOK IIP — OF THE POOR. triple the sum raised in the year 1776. From the same re¬ turns it appears, that on the population of England and Wales, exclusive of the army and navy, amounting to 8,070,000 souls, not less than 1,234,080 are partakers of parochial relief; that is, nearly one-seventh of the whole population are indebted to the rest, in whole or in part, for their support, and by far the larger part of these are wholly subsisted without any exertion of their own. The amount of this rate, too, great as it is, gives but an inadequate idea of the extent of this branch of expendi¬ ture in England. In an account published at Edinburgh of the management of the poor in Hamburgh, the author, Mr. Yoght, who had access to the best information during his tour through England, states the sum expended on workhouses at upwards of £1,000,000, sterling, on a low estimate. And if we take into account the vast sums distributed annually in voluntary charity, the whole sum of British charities cannot well be estimated lower than at £5,000,000 a year. According to a very well-informed and accurate writer, Lord Sheffield, the sum expended on the relief of the poor is equal to one-half of the rental of England at this time. This increase of the poor’s-rates is the more astonishing, when we reflect on the progress which has been made within the last few years by Benefit Clubs or Friendly Societies, one of the happiest institutions, undoubtedly, ever introduced into this country. We are assured by Sir Frederic Eden, after all his extensive inquiries on this subject, “ that he has not found any parish burdened with the maintenance of any one member of a friendly society, nor the instances numerous of the families of members becoming burdensome.”* The economy of which this institution has been productive to the nation, is incalcula¬ bly great. Abstracting altogether from the various salutary ends to which they are plainly conducive, it is sufficient to remark the industry, frugality, and independent spirit which it is the tendency of friendly societies to extend among the people. But of these different effects of this institution, I shall have occasion to speak more particularly afterwards. At pre- * [Ibid. Pref. p. xxv.J CHAP. I. — HISTORICAL SKETCH OF THE POOR-LAWS. (§1.) 275 sent, I shall only remark, that if with all the savings which have thus been occasioned by benefit clubs, and if, notwith¬ standing the uniform success with which they have been attended, wherever they have been carried into execution, the poor s-rates have doubled their former amount within the last twenty years, if only proves that the malignity of this political disorder is incomparably greater than, on a superficial view, we might be led to expect. I presume, that no person will go so perversely wrong, as to impute this increase to the institution of friendly societies, which are manifestly of the most salutary tendency. Notwithstanding, however, the vast and acknow¬ ledged mischiefs connected with the English system of Poor- laws, so deeply does the evil appear now to be rooted not only in the political condition of the country, but in the habits of thinking among the people of England, that not longer ago than the commencement of the present century, the following most extraordinary assertion was publicly maintained : — “ The poor have as good a right to their portion of my estate, as I have to my own/’ &c. The facts which have been already stated, together with the incidental remarks interspersed, seem abundantly to au¬ thorize doubts, whether, on the whole, it would not have been better if no national provision for the poor had been thought of by the English Legislature ; and if the care of this unfor¬ tunate class of men had been left entirely to the voluntary charity of their fellow-citizens. That this was the opinion of Montesquieu, may be inferred from the following clause, where, speaking of Hospitals, he remarks, that “ occasional provisions for the poor are better than perpetual foundations. The evil is temporary ; the remedy must, therefore, be of the same nature, and applicable to the particular circumstances.7’ v The same sentiment, too, was long ago expressed still more explicitly by an eminent writer of our own country, Mr. Henry bidding, whose opinion on the subject is ol peculiar weight, from his long and intimate acquaintance with the manners and habits of the lower orders of this country. u do say the truth, as this * [Esprit des Loix , Liv. XXIII. chap. xxix. Part II. p. 107.] 276 POLITICAL ECONOMY PART I. — BOOK III. — OF THE POOR. law hath been perverted in the execution, it were, perhaps, to be wished it had never been made. Not because it is not our duty to relieve real objects of distress, but because it is so much the duty of every man ; and I may add, so much the inclina¬ tion of most Englishmen, that it might have been safely left to private charity.”* Among our later politicians, this conclusion has been very generally adopted ; and it must be granted, that a strong argu¬ ment in its favour, arises from a consideration of the motives which are the great springs of human industry. What would become of the business of human life, if the passions of hope and fear were extinguished ; and, in the case of the lower orders, by what can their exertions be excited, but by that which ministers to the necessities of their present condition ? The influence of honour and ambition, the passions which actuate the higher orders, is scarcely felt among them ; nor is there anything to excite them to uniform exertion, but the necessity of providing for the passing day, and the prospect of securing some store for the helplessness of old age. To strengthen the influence of these motives, is one of the most important ends at which a legislator can aim ; and where his institutions, unfor¬ tunately, have an opposite tendency, it is vain to hope to remove, by means of any corrective police, that idleness, vice, and misery, of which he himself is the author. On this subject, a variety of excellent and striking observations have been lately made by Mr. Malthus, in the new edition of his Essay on the Prin¬ ciple of Population. The result of these observations is, that if the Poor-laws of England had never existed, ic though there might have been a few more instances of very severe distress, the aggregate mass of happiness would have been much greater.”f For the reasonings by which he supports this con¬ clusion, I refer to his very valuable work. It is, however, a very different question, whether, supposing no legal provision had been made for the poor, it would have * [Inquiry into the Causes of the f [Book ITT. chap. vi. ; Vol. II. p. Increase of Robbers, &c., Sect. iv. ; 177, edit. 1806.] Worlds, Vol. IV. p. 554.] CHAP. 1. — HISTORICAL SKETCH OF THE POOR-LAWS. (§1.) 277 been expedient to establish one : and whether, circumstanced as England actually is, it would be wise to abolish that part of her policy, by a direct repeal of the existing Laws ? According to Sir Frederic Eden, “ no temperate political speculatist of the present day has ventured to recommend the wholly lopping off this vast member of our system of jurisprudence. Among the various opinions as to the mode of relieving the wants of the dis¬ tressed classes of the community, and of correcting the abuses which have insensibly crept into the administration of the Poor- laws, it seems to be very generally agreed, that a modification only of those laws, and not a total repeal of them, can be attempted.”* To these observations, I shall take the liberty of adding, that there are many cases in which laws that are strictly conform¬ able to the great principles of justice and expediency, and which, undoubtedly, would form a part of a perfect system of legislation, would be attended with dangerous consequences, if connected with institutions which were not of a congenial spirit and tendency. Supposing, for example, that all the other prin¬ ciples of Political Economy, with regard to the freedom of trade, &c., were established and acted upon, there cannot be a doubt, that anything approaching to a compulsory mainten¬ ance of the poor, would be a glaring absurdity. But it is not equally clear whether a deviation in one instance from what is politically right, may not require other deviations of a similar nature. Into this discussion, however, I cannot now enter. These considerations, obvious and just as they undoubtedly are, do not furnish any argument in favour of a compulsory maintenance of the poor, as a wise political institution. On the contrary, they take for granted, that it is an evil when con¬ sidered abstractly. But they seem to render it somewhat doubtful, whether, with the different reforms required in that department, it might not be necessary to combine others relat¬ ing to very different articles ol Political Economy. Without, however, making any immediate or violent alteration on the general outline of the existing Poor-laws, there are some prin¬ ciples on which it is supposed by the more temperate reformers, * \ State of the Poor, Book IJ. chap. i. A ol. 1. p. 470.] 278 POLITICAL ECONOMY. — PART I. BOOK III. — OF THE POOR. that the Legislature might safely proceed, in checking the farther progress of the evil. Such is the measure proposed by Sir F rederic Eden, for limiting the assessments of the poor to the average of a certain number of years ; permitting a new average to be afterwards made at the end of certain stated periods. “ There would thus/' in the apprehension of this very respectable writer, a be room for future economy, though not for future extravagance."* This proposal of a limited assess¬ ment has been repeatedly sanctioned by the opinions both of statesmen and of speculative politicians of no inconsiderable note ; by Mr. Gilbert, for instance, who for so many years dis¬ tinguished himself as a useful and active member of the Lower Mouse, on all questions connected with the internal improve¬ ment of the country ; and by Sir William Pulteney, whose in¬ defatigable industry and zeal in promoting every measure which might be productive of general utility, are universally known in both parts of the United Kingdom ; and it has, for many years, found a zealous advocate in Mr. Arthur Young, to whom, indeed, the first idea of the plan is ascribed by Mr. Whitbread in his late Speech on the Poor-laws. f Simple and safe, however, as this measure may, at first view, appear to be, it has been warmly opposed by different writers : by Mr. Hewlett, in particular, in a work published by him in the year 1788, entitled, The Insufficiency of the Causes to which the Increase of the Poor has been commonly ascribed. Among the different objections urged by this last writer against a limited assessment, the most plausible is founded on the fatal consequences which might result to the impotent poor, from the scarcity of an inclement winter, when the assessment would be found inadequate to their wants. This objection has been lately pushed farther, and urged with still greater ability, by Mr. Malthus, in the Appendix to the last edition of his Essay. “ Under such a law," he observes, “ if the distresses of the poor were to be aggravated tenfold, either by the increase of numbers or the recurrence of a scarcity, the same sum would be invariably appropriated to their relief If the Statute which * [Ibid. p. 484.] t [P. 12.] CHAP. T. — HISTORICAL SKETCH OF THE POOR-LAWS. (§ 1.) 279 gives the poor a right to support, were to remain unexpunged, we should add to the cruelty of starving them, the extreme in¬ justice of still professing to relieve them. If this Statute were expunged or altered, we should virtually deny the right of the poor to support, and only retain the absurdity of saying, that they had a right to a certain sum.”* The same view of the subject has been adopted by Mr. Whitbread, in his Speech on the Poor-laws , where he concludes a very able argument in sup¬ port of Mr. Mai thus, by expressing his own conviction, that “ if an allowance is to be made to the poor, it ought to be co¬ extensive with the necessities to which it is to apply.” f On a question of this sort, relating to which my own means of information are so scanty, compared with those of Mr. Howlett, Mr. Whitbread, and Mr. Malthus, I certainly am not entitled to deliver any opinion. But I may be allowed, with¬ out the imputation of undue presumption, to observe, that the objection which they have stated against the expediency of a limited assessment, is, in some measure, inconsistent, as it seems to take for granted the very principle uniformly denied by those who support the scheme of a compulsory maintenance of the poor. The principle I allude to is, that the voluntary charity of individuals is not a sufficient resource for the poor in times of scarcity. But against this assumption, a variety of strong facts may be urged. Vast as our legal establishment is, and abundant as the means it affords of accomplishing its objects undoubtedly are, much still is entrusted by law to the uncon¬ strained charity of individuals. Nor does it appear from ex¬ perience, that the more opulent classes fail in discharging this duty, notwithstanding the effect which the legal provisions produce both in damping the spirit, and in exhausting the means of their beneficence. And it may, perhaps, be doubted, whether the cases in which their charity has been blameably deficient, be so numerous as those in which it has exceeded what is politically expedient. Although, however, the plan of a limited assessment seems to me to deserve a still more ample discussion before it is 280 POLITICAL ECONOMY. — PART I. — BOOK III. — OF THE POOR. finally rejected, I must acknowledge, that i am much less san¬ guine in my hopes of its practicability, after the decided tone in which it has been reprobated by these three individuals, all of whom are so intimately acquainted with the local details, and with the established prejudices of the English nation. Nor must I omit the dexterity with which Mr. Malthus has quoted Mr. Young against himself, on this very question ; an incon¬ sistency, which I am the more disposed to take notice of, as it tends to justify a censure which I passed, in a former part of this course, on the numerous contradictions and inconsistencies which abound in the words of this industrious and public- spirited writer — “ The National Assembly of France, though they disapproved of the English Poor-laws, still adopted their principle, and declared, that the poor had a right to pecuniary assistance ; that the Assembly ought to consider such a provi¬ sion as one of its first and most sacred duties ; and that with this view, an expense ought to be incurred of fifty millions a year. Mr. Young justly observes, that he does not compre¬ hend how it is possible to regard the expenditure of fifty millions a year as a sacred duty, and not extend that fifty to one hundred, if necessity should demand it ; the one hundred to two hundred, the two hundred to three hundred, and so on in the same miserable progression which has taken place in England.”* It is unnecessary for me to remark, that this is precisely the argument employed by Mr. Malthus against Mr. Young’s own plan of a limited assessment, with this important difference, however, (I must in justice to Mr. Young observe,) that the National Assembly of France had sanctioned, by a legislative act, those very dangerous prejudices which previously had no existence there. Another plan for a gradual abolition of the Poor-laws has been proposed by Mr. Malthus. The leading idea of this plan is, that “ no child born of any marriage taking place after the expiration of a year from the date of the proposed law, and no illegitimate child born within two years, should be entitled to '* [Essay on Population — Appendix, Yol. I I. p. 529, third edition.] CHAP. I. — HISTORICAL SKETCH OF THE POOR-LAWS. (§1.) 281 parish assistance”* To this proposal, Mr. Whitbread lias objected in very strong and pointed terms in his Speech on the Poor-laws , and has even gone so far as to say, that it would necessarily be repealed within two years of its establishment.! For my own part, I must confess, that the considerations stated by Mr. Whitbread in support of his opinion, do not carry con¬ viction to my mind. Of the difficulties to be expected in carrying the plan into execution, I am perfectly aware ; but if these are not altogether insurmountable, we ought to weigh carefully in the other scale of the balance the magnitude of the evil which it is its object to remedy. The plan has, at least, the merit of conformity to general principles, inasmuch as it involves a disavowal of the whole system of compulsory maintenance, while, at the same time, it avoids all rejection of those claims which individuals might be expected to allege, if any privileges were withdrawn from them by law, which they had, from infancy, been taught to regard as their right. Before leaving the subject of the English Poor-laws, it is proper for me to observe, that the general principle of compul¬ sory maintenance upon which they are founded, strongly as the preceding facts and reasonings appear to conclude against it, is by no means abandoned as either unjust or inexpedient by all our speculative politicians, even in the present times. The ingenious author of an Essay on the Flight of Property in Land , which was published a few years ago, extols them as the most generous and reputable branch of our internal legisla¬ tion ; and Mr. Howlett has pronounced the general system on this subject to be “ a venerable pile, raised by the hands of skilful architects, and to stand a distinguished monument of the wisdom and humanity of the British nation. Like every other edifice,” he continues, u it is liable, indeed, to the in¬ juries of time and seasons, and must want occasional repairs and occasional improvements ; but if pulled entirely down, we might stand a chance ol either being buried in its ruins, or, at best, of never raising anything in its stead of equal grandeur, * [Ibid. p. 396.] + 1 P. i6.] 282 POLITICAL ECONOMY. — PART I. — BOOK III. — OF THE POOR. utility, or beauty.”* The same opinion lie has since main¬ tained in the Examination of Mr. Pitt's Speech in the year 1796: — u To me this system appears a most judicious union of wisdom and humanity. This is the true spirit of our Poor- laws.” f The increase of the poor, which is commonly ascribed to our injudicious system of Poor-laws, and their defective execution, is chiefly owing, in the opinion of Mr. Howlett, to a greater advance in the price of provisions than in the price of labour. His remarks on the point are extremely interesting and valu¬ able. But admitting them to be perfectly just, all that they prove is, that the increase of the poor in England is not to be ascribed solely either to the existing Laws, or to their injudicious execution ; and that other powerful causes co-operate in aggra¬ vating the evil. That the increase of mendicity arises, partly from some general causes affecting other countries of Europe, as well as England, may be inferred from some facts collected by Mr. Howlett, with respect to the multiplication of the poor in Scotland and in Prance. His information concerning the latter kingdom, particularly, is curious, and it seems to have been communicated to him by a very intelligent and authentic writer. “ I can venture to assert, with the utmost confidence,” says Mr. Hewlett's correspondent in a letter dated in 1788, “ that the poor of France, within a very few years, have been extremely multiplied ; that, notwithstanding the public contri¬ butions for their maintenance are much more abundant than ever, they are still in a very deplorable situation, and that the capital is by no means the only city in which are at once pre¬ sented to the view, the astonishing contrast between the most extravagant luxury on the one hand, and the most shocking distress on the other. Orleans being situate between the richest and the poorest provinces, may be considered as a kind of standard or medium by which to judge of the kingdom at * [ The Insufficiency of the Causes to ascribed , &c., 1788, Fart HI. sect iii. which the Increase of our Poor and of p. 118.] the Poor’ s-rates have been commonly t [Sect. I. p. 5.J CHAP. I. — HISTORICAL SKETCH OF THE POOR-LAWS. (§ 1.) 283 large ; the total population of this city is 50,000 persons, of whom one-third receive charitable assistance from their supe¬ riors/' All measures, both severe and mild, have been tried to reduce the number of poor in this town. The amount of the several contributions for tlieir relief, the same correspondent states, u at about 360,000 livres, or £19,000 a year. But not¬ withstanding these, and similar exertions of benevolence in every part of the kingdom, no season of uncommon severity arrives, but vast numbers of entire families, especially in the country, perish for want, are strictly and literally starved and frozen to death/'* An examination of the causes of this multiplication of the poor in countries where no legal provisions are made for them, could not fail to lead to important conclusions. But although it might shew, that the mischiefs of the English Poor-laws have been somewhat exaggerated, it would never tend to a vin¬ dication of the general principle on which they are founded. With respect to the facts on which so much stress is laid by Mr. Howlett, as establishing the disproportion between the rate of wages and the price of provisions, I do not mean to enter at present into any discussion. I shall only remark, that the rate of wages cannot be expected to fluctuate, nor is it ex¬ pedient that it should fluctuate, with the occasional variations in the money price of corn. I have already had occasion to shew that the price of wages has a natural tendency to adjust itself to the average money price of the necessaries of life. That this natural tendency is beneficial, on the whole, to all the parties concerned, may be easily demonstrated. Nor does it seem possible for the law to interfere for regulating it on any other principle, without aggravating the evil. Supposing that the price of labour were regulated, as has been proposed by some speculative men, and men mentioned in our National Assembly, by the price of corn, what would be the consequence in a year of scarcity P Manifestly this : that as the most numerous class of consumers would be enabled to purchase the same quantity as in a year of plenty, the same consumption •* {Insufficiency of the Causes , &c\, Fart I. sect. i. pp. 16-18.] 284 POLITICAL ECONOMY. — PART I.— BOOK III. — OF THE POOR. would take place in the one case as in the other, and the neces¬ sity of that economy would be superseded, which can alone prevent a dearth from ending in a famine. I would not be understood, by these remarks, to give any opinion on the question, Whether the real reward of labour has been increasing or declining, within the last fifty years ? Mr. Hewlett's opinion on this question has been already stated. The contrary is strongly maintained by Sir Frederic Eden, who published in the year 1797 ; and by Mr. Smith, in his Wealth of Nations, published about twenty years before. Mr. Burke, too, in a paper written in November 1795, asserts confidently, that a even under all the hardships of the last year, the labour¬ ing people did, either out of their direct gains, or from charity, in fact, fare better than they did, in seasons of common plenty, fifty or sixty years ago ; or even at the period of my English observation.”* The question, in truth, resolves ultimately into a still more general one, with respect to the progressive or declining state of the funds destined for the employment and maintenance of labour ; a question, undoubtedly, of the most interesting nature, but which, in whatever way it may be de¬ cided, does not appear to have any immediate connexion with the discussion concerning the expediency of a legal provision for the poor, or of a legal limitation of the rate of wages. For even on the supposition that the circumstances of the country were in this respect declining, the evil, obviously, is not of a kind which admits of a legislative correction, in any other way than by supplying what is defective, or amending what is erroneous in the general system of Political Economy. So much with respect to the legal establishment for the provision of the poor as it exists in England, and the various subordinate articles which seem to be more particularly con¬ nected with that branch of police. On the various plans which have been proposed for the gradual amendment and refor¬ mation of the English system, I do not presume to offer any opinion ; nor, indeed, am I qualified to do so, without * {Thoughts and Details on Scarcity; I Yorks, Vol. VII. p. 379, edit. 1808.J CHAP. I. — HISTORICAL SKETCH OF THe’poOR-LAWS. (§ 1.) 285 having had an opportunity of ascertaining, by personal obser¬ vation, a great variety of facts about which I find the most contradictory statements in the works of authors who are all equally entitled to credit for their talents, their characters, and their means of information. One good consequence which is, at least, to be expected from the succession of bad years which lately took place, is, that the mass of important information which these were the occasion of bringing before the public, is likely to invite speculative men to attend to the reformation of this branch of police, at a time when the general principles of Political Economy are unquestionably much better understood than at any former period when it was an object of legislative attention. The labours of Sir Frederic Eden in this depart¬ ment are entitled to peculiar praise. They do great honour to his persevering industry as a collector of facts, and to his en¬ lightened zeal as a good citizen ; and whoever undertakes the subject after him, will find the consideration of it much facili¬ tated, by the extent and accuracy of his researches. It is to be regretted, that he had not bestowed a little more time in con- densing and arranging his materials ; as his valuable work, certainly, is not likely, in its present form, to attract the atten¬ tion of an ordinary reader. In justice to this author, however, I must observe, that this very defect seems to have been owing, in a great measure, to a motive which reflects greater honour on him than the attainment of literary fame ; an anxiety, while Mr. Pitt’s Poor Bill was under the examination of Parliament, to contribute whatever information he was possessed of that might have the most remote tendency to enlighten and direct its proceedings. For the inelegances of style which the work contains, no better apology can be offered than in his own words : in quoting which, I cannot help remarking, how com¬ pletely they prove with what facility he might have added the graces of composition, if he had aimed merely at the fame ot an eloquent writer. “ I have endeavoured to be plain, simple, and perspicuous, but have never wasted that time in polishing a sentence which I thought I could better employ in ascertain¬ ing a fact ; and even in matters ot fact thus brought forward, O ' 286 POLITICAL ECONOMY. — PART I. — BOOK III. — OF THE POOR. there will, I more than doubt, be too often found something to object to as inaccurate/’* In compiling the foregoing histori¬ cal sketch, I have availed myself very largely of the assistance which this writer’s work afforded me, confining myself, how¬ ever, to the most prominent facts, and distinguishing them, as much as possible, from details of inferior importance. The view which I have exhibited, with all its imperfections, will, I hope, be sufficient to convey a general idea of the present system of Poor-laws in England, and of the most interesting discussions to which it has given rise. SECT. II. — OF THE SCOTTISH POOR-LAWS. I now proceed to a short statement of the Laws relative to the same subject, in our own part of the United Kingdom. The Scottish Laws with regard to the poor, merit our atten¬ tion not merely on account of their more immediate reference to the concerns of our own country, but as affording an experi¬ mental proof of the good or bad effects resulting from a system which is strikingly contrasted with that of the English legis¬ lators. Of the contrast which this part of our Scottish policy exhibits to the corresponding regulations of the English code, particular notice was taken at an early period, by a very eminent man, who had enjoyed the best opportunities of ob¬ serving the consequences of both. I allude to Bishop Burnet, who, in the Conclusion of his History of his Own Times , pub¬ lished in the year 1708, expresses himself thus: — “ It may be thought a strange notion from a Bishop, to wish that the Act for charging every parish to maintain their own poor, were well reviewed, if not quite taken away ; this seems to encourage idle and lazy people in their sloth, when they know they must be maintained ; I know no other place in the world where such a law was ever made. Scotland is much the poorest part of the island, yet the poor there are maintained by the voluntary charities of the people. Holland is the most perfect pattern for putting charity in a good method ; the poor work as much as * [State of the Poor , Preface, p. xxix.] CHAP. I. — HISTORICAL SKETCH OF THE POOR-LAWS. (§ 2.) 287 they can ; they are humble and industrious ; they never ask any charity, and yet they are well relieved. When the poor see that their supply must, in a great measure, depend on their behaviour and on their industry, as far as it can go, it will both make them better in themselves, and move others to supply them more liberally ; and when men s offerings are free, (and yet are called for, every time they go to church or to sacra¬ ment,) this will oblige those who distribute them, to be exact and impartial in it, since their ill conduct might make the givers trust them with their charity no more, but distribute it themselves/'* From the particulars which I am now to state, it will ap¬ pear that Bishop Burnet had confined his attention solely to the established practice of the two different parts of the island, in their management of the poor, without taking into con¬ sideration the existing Statutes on the subject in the Scottish code, which he probably regarded as a dead letter. At the same time, it is somewhat curious, when we consider how con¬ versant this writer was with the jurisprudence of both parts of the island, that he should have regarded the law of compul¬ sory maintenance as altogether peculiar to the English code. This circumstance, however, does not in the least detract from the value of this very weighty testimony with regard to the op¬ posite effects of compulsory assessments and voluntary charity. The earliest Statute to be found in the Scottish Acts relative to this subject, was passed in the reign of James I., in the year 1424. During the minority of this Prince, it is well known that Scotland was in the most unsettled state, great numbers who had no lawful occupation subsisting entirely by rapine and plunder. The King, on his return from captivity in Eng¬ land, where he had enjoyed the advantage of a good education, and had witnessed the happy effects of a regular and vigilant government, turned his thoughts to the improvement of the situation of his own kingdom ; and as an indispensable preli¬ minary to his other measures, began by improving its internal police, as this seemed most likely to he effectual in protecting * [Vol. TI. p. 659, ong. c sdit. 288 POLITICAL ECONOMY. — PART I. — BOOK III. — OF THE POOR. his peaceable and industrious subjects against the violence and rapine which were then so prevalent in every part of the king¬ dom. In his First Parliament, it is statuted, that “ na com¬ panies passe in the countrie, to lye upon onie the Kingis lieges : or thig ; or sojourne horse, outher on kirk-men, or husbands of the land f and that u gif onie complaint be maid of sik tres- passoures to the schireffe of the land ; that he arreist sik folk, and challenge them, and tax the Kingis skaitli upon them : and gif they be convict of sik trespasse, that they be punished, and find burrowes till assyeth (that is, to satisfy or recom¬ pense) the King and the partie complainand.”* In the same Parliament, it is ordained, that ee na thiggeres be thoiled to beg, nouther to burgh nor land-wart, betwixt fourteen and threescore ten zeires, hot they be secure be the councelles of the tonnes, or of the lande, that they may not winne their living uther waies/’f In James III/s Parliament, (1425,) it is or¬ dained, that ec the scheriffe sail gar arreist idle men, and gar keepe them in fastenesse quliill it be knawin quhairupon they live. And that the countrie sail be unskaithed of them : there¬ upon the schireffe sail receive gude and sicker burrowes. After the quhilk burrowes founden, the scheriffe sail assigne fourtie dales to sik idle men to get them maisters, or to fasten them to lawful! craftes. And they fourties daies beand gane, gif they be founden mair idle, the schireffe sail arreist them againe, and sende them to the Kingis prison, to abide and be punished at the Kingis will.”{ In stating these particulars, it may be thought that I enter more into detail than is necessary or proper in this place, and that the minute provisions made for the police of a barbarous country in the fifteenth century, might safely be omitted in a political speculation, which is meant to have reference to our own times. But although I am ready to acknowledge the truth of this observation, I cannot prevail on myself to omit the opportunity which the present subject affords me, of quot¬ ing a few clauses from our old Statutes, which are valuable, as * [Eden’s State of the Poor, Appen¬ dix x. ; Vol. III. p. cclxxviii.J + [Ibid. p. cclxxix.] t [^id.] CHAP. I. — HISTORICAL SKETCH OF THE POOR-LAWS. (§ 2.) 289 throwing light on the progress of order and civilisation in Scotland. Nor will they be found altogether foreign to the principal object of our inquiry, inasmuch as they strongly illustrate the impotency of legislative interference in curing, by the mere regulations of police, disorders which originate in the general condition and habits of the country. I have already taken notice of the rigour of some laws of J ames I. against beggars. In the sixth Parliament of his suc¬ cessor, a law still more severe than any hitherto mentioned, was passed against the same description of offenders. It is probable that the disorders which these laws were meant to remedy, had, during the King’s minority, become more pre¬ valent. By this Act a it is ordained, for the away-putting of sornares, over -lyars, and maisterful beggars, with horse, houndes, and uther gudes, that all officiares, baith schireffes, baronnes, aldermen, baillies, as well within the burgh, as outwith, take an inquisition at ilk courte that they hald of the foresaid things : and gif ony sik be founden, that their horse, houndes, or uther gudes be escheit to the King, and their person put in the Kingis waird, quhill the King have said his will to them. And alswa that the said scheriffes, &c., inquire at ilk courte, gif there be onie that makis them fuiles, and are bairdes, or uthers sik like rinnares about. And gif onie sik be founden, that they be put in the Kingis waird, or in his irones, for their tresspasses, als lang as they have ony gudes of their awin to live upon, that their eares be nailed to the trone, or till ane uther tree, and their eare cutted off ; and banished the countrie. And gif thereafter they be founden againe, that they be hanged.”* Various other laws, breathing the same spirit, were enacted during the reigns of James II., James III., and James IV In an Act passed in the fifth Parliament of James V., (1535,) after ordaining the strict execution of the Statute of James I., it is added, that no beggars should “ be thoiled to beg in ane parochin, that are borne in ane uther ; and that the heades- men of ilk parochin make taldnnes and give to the beggars thereof, and that they be susteined within the bounds oi that * [Ibid. p. cclxxx.J VOL. IX. 290 POLITICAL ECONOMY. — PART I. — BOOK III. — OF THE POOR. parochin, and that nane uthers be served with almous within the bounds of that parochin, bot they that bearis that takinne allanerlie.”* On an examination of the laws which were passed previous to this period, it will be found evident, from their general scope, that they were framed chiefly with the view of repressing the banditti and vagrants who had disturbed the public peace. It is probable, that the impotent poor were comparatively incon¬ siderable in number, or that they were easily supported by voluntary alms. In all the subsequent Acts, the laws respect¬ ing vagrants, and the idle and impotent poor, are included in one Statute ; their principal object being, avowedly, to compel the idle to industry, and to provide for the indigent. In con¬ sequence of the advanced state of the country, it would appear that the banditti who had formerly been so numerous, had become less formidable ; while, on the other hand, the failure of their former resources, added to the commercial progress of the country, tended at once to multiply the objects of real charity, and to impose on the Legislature the necessity of open¬ ing new sources of bounty in their favour. At the era of the Reformation, it appears that some of the leaders in that me¬ morable cause had struggled at first to obtain, under the new system, the establishment of a plan for the support of the poor, to supply the place of those aids which they had enjoyed formerly ; and in the proposal which was made to the first General Assembly, in the year 1516, it was suggested, that a fund for the support of the poor, as well as for the establish¬ ment of schools, and the endowment of the reformed clergy, should be assigned out of the old revenues of the Church. But the nobles, who had got possession of the Church’s patrimony, rejected the proposal, as John Knox informs us, as altogether visionary. The grievance, however, at length became so seri¬ ous, and was so severely felt by all orders of the community, that it was necessary for the Legislature to attempt a remedy. Accordingly in the year 1579, a Statute was passed, which is the groundwork of all the subsequent enactments on this head, and * [Ibid. p. cclxxxi.] CHAP. I. — HISTORICAL SKETCH OF THE POOR-LAWS. (§2.) 291 which is so full, minute, and systematic, that it is justly said to constitute, with the exception of a few subsequent amendments, our code of Poor-laws. Of the history of this important Act, which does not seem to have been much attended to either by our Scottish or English antiquaries, I shall have occasion after¬ wards to take notice. In this Act, passed in the sixth Parlia¬ ment of King James VI., it is ordained, “ that the Provestes and Baillies of ilk burgh and towne, and the Justice constitute be the King's Commission in every parochin to land wart, sail, betwixt and the first day of Januar nixt-to-cum, take inquisi¬ tion of all aged pure, impotent, and decayed persones, borne within that parochin ; or quhilkes war dwelling, and had their maist commoun resorte in the saide parochin, the last seven zeires by past, quhilkes of necessitie mon live bee almes : and upon the saide inquisition, sail make ane register buike, con- teining their names, and surnames, to remain with the Pro¬ vestes, and Baillies, or with the Justice." And to enable them to make such a register, the poor are commanded, “ under the paine to be punished as vagabondes,” to repair to the parish in which they were born, or had resided for seven years. After having thus ascertained the number and necessities of the poor, the Magistrates are commanded “ to taxe and stent the haill inhabitants within the parochin, according to the estimation of their substance, without exception of persones, to sik oulkie charge and contribution, as sail be thocht expedient and suffi¬ cient to susteine the saidis pure peopil, and the names of the inhabitants stented, togidder with their taxation, to bee like¬ wise registrate." Collectors and overseers are likewise to be appointed to superintend the collection and distribution of the tax, and the register is ordained to be made anew every year/- From the very exact coincidence between the provisions of this Statute, and those of the 43d of Elizabeth, Sir Frederic Eden concludes, that the latter was framed on the model of the former. His words are these : — u Although Scotland is now exempted from the heavy burthen of a Poors-rate, it is remarkable that a compulsory provision for the poor was esta- * [Ibid. p. cclxxxiv., seq.] 292 POLITICAL ECONOMY. — PART I. — BOOK III. — OF THE POOR. blished by law, in the former kingdom, two~and-twenty years before the passing of the 43d of Elizabeth. In the sixth Par¬ liament of James VI., held at Edinburgh in 1579, an Act was passed i for punishment of strang and idle beggars, and reliefe of the pure and impotent in which every branch of the poor system, — the punishment of vagabonds, of runaway servants ; — the mode of passing soldiers and seamen to their parishes ; — the regulation of hospitals for aged and impotent persons ; — the settlements of the poor ; — their maintenance by the parish ; — the appointment of overseers and collectors ; — the manner of treating those who refuse to work ; — and of putting out poor children apprentices, are more fully detailed than in any English Act of Parliament. ... I have very little doubt but that many of the provisions of English Parliaments, in the reign of Elizabeth, respecting the poor, were framed in con¬ formity with the policy of their northern neighbours/’* In opposition to this statement with respect to the Act of the Scottish Parliament in 1579, it has been observed to me by my friend, Mr. Francis Horner, that this Act is a literal transcript of a Statute passed seven years before by the Parliament of England, (14tli Elizabeth, cap. 20,) which, having been super¬ seded by the subsequent enactments, is not printed in the modern editions of the Statutes at large, but may be found in the older collections. All its provisions, both for the relief of the poor and the repression of vagrants, are exactly the same ; and even the turn of expression is scarcely varied. It would appear, therefore, that this Act of the 14th of Elizabeth, has been altogether overlooked by Sir Frederic, when he hazarded the conjecture stated above. The fifteenth Parliament of James VI., (1597,) ratifies the former Act, with this addition, “ that starke beggars, and their bairnes, be employed in commoun warkes/’f The twenty-eighth Parliament of the same King, (1617,) ordains, that “ Foras¬ much as there hath been divers worthy laws and statutes made by his Majesty, and his Highness’ predecessors, for restraining * [Ibid. Book 1. chap. ii. ; Yol. I. p. j [Ibid. Appendix X.; Yol. I. p. 131, note.] cclxxxvii.] CHAP. I. — HISTORICAL SKETCH OF THE POOR-LAWS. (§ 2.) 293 of idle and masterful beggars; and notwithstanding thereof, the number of the saids beggars hath daily increased more and more : and his Majesty and estates, considering that the cause of the multiplying of the saids beggars hath, and doth, proceed from this ground, that no order hath been taken, in bygone time, with the poor children and orphans, born of poor indigent parents, who being tollerated or neglected, at their first entry to begging, doth contract such a custome and habite, that hardly they can be drawn thereafter to any other calling. . . . Therefore his Majesty, with advice and consent of the estates, doth, in most earnest manner, recommend to all his Highness5 loving subjects, requesting them, as they tender the good and honour of the realme, to receive within their houses and family, and to take upon tlieir care, intertainment, and education, some of the saids poor and indigent children, one or moe, every per¬ son according to his power and faculty, .... to be educate and brought up by them, either in their houses, or to be put by them to such crafts, callings, and vocations, either within the country, or without the same, as they please/'’* These two {Statutes fix a memorable era in the history of this branch of Scottish jurisprudence, a commencement having been then given to those important functions in the superintendence and management of the poor, which the kirk-sessions, or parochial consistories, have since exercised in a manner so creditable to themselves, and so beneficial to their country. The sixteenth Act of the third Session of the first Parliament of King Charles II., ratifies all former Acts concerning vaga¬ bonds and poor, and farther ordains, “ that it shall be lei sum to all persons or societies, who have or shall set up any manu¬ factories within this kingdom, to seize upon and apprehend the persons of any vagabonds, who shall be found begging, and who, being masterless and out of service, have not wherewith to maintain themselves by their own means and work, and to imploy them for their service as they shall see fit, the same being done with the advice ol the respective magistrates of the place where they shall be seized upon, etc. j Ibis is a most * [Ibid. p. cclxxxviii.] t Hbid. [>. cclxxxix.] 294 POLITICAL ECONOMY. — PART I. — BOOK HI. — OF THE POOR. important enactment, as we shall afterwards see, and that to which must chiefly be ascribed the advantage which Scotland possesses over the sister kingdom in this branch of her policy. u The last Statute which in Scotland was enacted con¬ cerning the poor, bears date the 1st September 1698 ; and it ratifies and approves all former Acts of Parliament for re¬ pressing of beggars, and maintaining and employing the poor/’* The era at which it passed is memorable in the annals of Scot¬ land, a severe dearth having continued from 1692 to 1699, the memory of which was preserved among the common people, within the period of my own recollection, by the name of “ the seven ill years/" Notwithstanding, however, the existence of this unrepealed Law, the fact is, that the greater part of the enactments and statutes which it sanctions, have silently fallen into desuetude, in consequence partly of their total inapplicability to the actual circumstances of the country, and partly of the manifold con¬ tradictions which they contain, and of their palpable inconsist¬ ency with each other. That the poor, however, in Scotland, do possess a legal claim to relief, is a principle placed beyond all doubt by repeated decisions of our Supreme Court. By a find¬ ing of 6th June 1744, it was decreed on a question between two parishes in Berwickshire, that residence for three years in a parish, gives the pauper a right to relief. In the case of the parish of Humbie, (13th February 1757,) with regard to the joint administration of the poor funds by the heritors or tenants, the whole system of the Scottish Poor-laws was investigated very minutely ; and not only the decree, but all the arguments em¬ ployed on this occasion, proceed on the supposition, that the Act 1579, with its subsequent amendments, is fully in force. Since the last scarcity, a new case, from the same parish of Dunse, has been determined by the Court of Session. The question on which it turned was this : whether, under the Scottish Poor-laws, those persons are entitled to relief, who, with¬ out any personal infirmity, are rendered unable by the high price of provisions to maintain themselves, and whether assess- * | lbid. p. ccxciii.] CHAP. 1. HISTORICAL SKETCH OF THE POOR-LAWS. (§ 2.) 295 ments are legal in times of dearth. The Court decided, 17th January 1804, that such relief and assessment are legal. I thought it in some measure necessary to enter into these details, as Sir Frederic Eden, whose authority in those parts of English police, which relate to this matter, is generally allowed to be very safe, has been so far misled by an article in the Encyclopaedia Britannica , as to assert, that there is no law in force in Scotland on the subject of a compulsory assessment for the poor a mistake into which, I must, at the same time, allow that it was not unnatural for a stranger to fall, after the very loose and incorrect language which has been employed on the subject by several of our Scottish clergymen, in their Statis¬ tical Reports. With respect to the fret, there is some irre¬ gularity in different parts of Scotland, by which it is not surprising that a stranger should be perplexed in this matter. In some parishes, assessments have been made for forty years past, while in others, which still are a majority of the whole, the collections at the church-doors, the small fines levied by the kirk-sessions for petty immoralities, and the interest of the small sums accumulated or bequeathed to the poor, have ren¬ dered legal assessments superfluous. In those parishes where assessments are made, the usual plan is thus described by Dr. Sommcrville, in his Statistical Account of the Parish of Jedburgh . “ The minister intimates from the pulpit, that on such a day a meeting of the heritors and elders is to be held, for the pur¬ pose of making a provision for the poor for the ensuing quarter. These meetings generally take place near the terms of Candle¬ mas, Whitsunday, Lammas, and Martinmas. Upon the day of’ meeting the elders elect a preses, after which the minutes of the former sederunt, and the roll of the poor, are read by the clerk. Forming a calculation from the number already stand¬ ing upon the roll, and the applications made to them, the heritors assess themselves in a certain sum to be collected from them severally, according to the proportion of their valued rents. The proprietor pays one-half of the assessment, and the 296 POLITICAL ECONOMY. — PART I. — BOOK III. — OF THE POOR. tenant the other. Though the tenants are not mentioned in the summons, yet such of them as choose to attend are made welcome, and their advice and information listened to by the meeting. The sum assessed is raised by the heritors and kirk- session together, in such proportions as seem adequate to the necessities of the poor. Such persons as are reduced to the necessity of applying to the heritors for charity, from any acci¬ dental transient cause, such as disease or misfortune , receive what is called an interim supply , i.e., a certain sum for that quarter only. The aged and infirm, and such as are likely to continue under the same necessity of depending upon public charity, are taken upon the poor s-roll at a certain weekly allowance. The persons taken upon the roll are obliged to subscribe a bond or deed of conveyance, making over and be¬ queathing all their effects to the heritors ; and though the heritors seldom exact their effects, yet the subscription of the bond serves as a check to prevent persons, who may be pos¬ sessed of concealed property, from alienating the public charity. The sum assessed is levied by a collector, appointed by the heritors, and distributed by him to the persons admitted upon the roll, according to the proportions allotted to them.”* For the information of those who are little acquainted with the institutions and phraseology peculiar to Scotland, it is ne¬ cessary to add that the kirk-session , by which the greater part of the poor are relieved, is somewhat similar to an English vestry ; that is, when regularly constituted, it must always consist of the minister, elders, session-clerk, and kirk-treasurer. The salaries which are allowed to the session-clerk and kirk- treasurer, who is usually the schoolmaster of the parish, seldom, if ever, exceed £2 sterling ; and with this trifling exception, the whole business of the collection, superintendence, and dis¬ tribution of the poor s funds, is managed without a farthing of expense. No similar instance, I believe, of frugality and disinterested zeal in the administration of so extensive a charity, can be produced in any country of Europe. F rom what has been now stated concerning the poor-rates * [Sir John Sinclair’s t Statistical Account of Scotland , Yol. L pp. 12, 13.] CHAP. I. — HISTORICAL SKETCH OF THE POOR-LAWS. (§ 2.) 297 in those parts of the country where they have been introduced, it is evident that many of the objections which are commonly urged against that tax as levied in England, do not apply to it when subjected to such checks and modifications as have hitherto restrained its abuse in this country. The chief and most essential of these, undoubtedly, arises from the manner in which the tax is imposed on this side of the Tweed, that being done by the persons who are to pay it ; whereas in England it is trusted to the discretion of a few obscure individuals on whom the burden does not fall, and whose responsibility is not great. Accordingly, some very candid and intelligent writers, who acknowledge the intolerable burden which it has brought on the other part of the island, have expressed strongly their approbation of the general principle on which the tax proceeds, and their conviction of the expediency of extending the practice over Scotland, on a plan which has been so successfully exem¬ plified in a variety of different instances. Nay, even Lord Karnes himself, who has pushed the argument against compul¬ sory maintenance to its utmost possible extent, has been almost led to admit an exception in favour of Scotland.* With respect to the moral effects which have been experi¬ enced from poor-rates in Scotland, the following statement is given by a very candid and very competent judge, who has long had an opportunity of witnessing their practical tendency in that part of the country where he resides, Dr. Charters of Wilton. “ It is alleged,” says he, “ that poor-rates weaken parental and filial affection. Let the fact be fairly inquired into, and it will be found, that many children labour hard to prevent their parents from receiving an aliment ; and that children in good circumstances who suffer their parents to re¬ ceive it are infamous: — a proof that the case is rare. During twenty-two years' ministry, in a pretty numerous parish, where the poor are maintained by taxation, 1 have known only one instance of children refusing to assist their parents ; they for¬ feited the esteem of their neighbours, and banished themselves 298 POLITICAL ECONOMY. — PART I. — BOOK III. — OF THE POOR. to America.”* In another passage, the same writer expresses himself thus : — “ The desire of laying up is so strong, that the poor-rate has not yet, and probably never will, extinguish it. A spirit of independence pervades the people ; they feel the humiliation of receiving alms ; they discern the difference be¬ twixt having of their own, and trusting to what is given.” j* Notwithstanding, however, these very strong statements, which cannot fail to have great weight with all who know the worth and talents of the author, I cannot help (probably from the circumstance of having lived chiefly in those parts of the country where poor-rates are unknown) feeling a decided par¬ tiality, more especially in a moral view, in favour of the old practice of supporting the poor by voluntary contributions, wherever imperious circumstances do not render this imprac¬ ticable. Where the case is otherwise, the question no longer admits of discussion, and a compulsory law is the only expe¬ dient which can supply an effectual remedy. In favour of the moral effects of our good old practice, I shall only observe farther, that where a tax is imposed for relief of the poor, and where, of course, the only aid received by them is extorted from the rich without their consent, it is impossible for the objects of this compulsory beneficence to feel themselves indebted for that which is given without charity, or to consider it in the same light with that which is bestowed from generous motives. As soon as it is thought that the assistance given them is their right, the relief conceded is considered as only what is due, and the least hardship to which they may be exposed is viewed as injustice. Independently, therefore, of all other considerations, there is intrinsically a material difference between the moral effects of voluntary contributions, and those that may be expected to result from legal assessments, however wisely regulated, and however ably and honourably administered. It ought to be carefully considered by the advocates of a compulsory assess¬ ment, whether the evils complained of in England have not * [Sir John Sinclair’s Statistical Account of Scotland, Yol. AY. pp. 641, 642.] f [Ibid. p. 642. | CHAP. I. — HISTORICAL SKETCH OF THE POOR-LAWS. (§ 2.) 299 been the natural and necessary, though, perhaps, slow conse¬ quences of the legal provision. While such checks, indeed, exist, as those in Scotland, it is difficult to conceive how any very gross abuses can take place in country parishes. But in great towns, the experiment is infinitely more hazardous. It does not seem to be possible, indeed, to contrive any system, which is not likely, sooner or later, to degenerate into such a state as that which we find prevalent in England. Even in country parishes, the result of past experience furnishes but too much ground for serious alarm. It is asserted by Mr. Findlater, in his very judicious and able Survey of the County of Peebles, that where poor-rates have been regularly established in Scotland, the poor have been continually on the increase.* Of this assertion, he has produced some proofs well entitled to the consideration of those who take an interest in the decision of this question, as a matter of local expediency, (for, in truth, it is nothing more,) in those parts of the country with which they may be connected. * [Chap. XY. sect. vii. p. 226.] [CHAPTER II.] [subsidiary measures for the relief of the poor.] To the historical sketch which has already been given con¬ cerning the Poor-laws in both parts of the United Kingdom, I think it may be useful for me to add a few remarks on certain Subsidiary Measures, for the attainment of the same ends, which have either been sanctioned by the authority of the Legislature, or have been carried into execution by the act of private individuals. [SECT. I. — OF CHARITY WORKHOUSES.] Among these measures, one of the most plausible is that of Charity Workhouses, a plan proposed more than a century ago by Sir Matthew Hale, and warmly defended by many respect¬ able writers of a later date. The scheme proposed is, in general, this : — That after a list has been taken of all the poor in any one populous parish, or in two or more smaller parishes, a house should be built for their accommodation ; that mate¬ rials for work of various kinds should be provided for them ; that this house should be under the direction of a few respect¬ able individuals, who should appoint one or more superinten¬ dents to regulate and inspect the management, &c. It cannot be denied that this plan promises, in theory, some very impor¬ tant advantages. In the first place, It leaves no opportunities for common beggary. The loathsome objects which fill our streets will be taken care of : the lame, diseased, and aged will be provided for. Secondly , It leaves no excuse for idleness : work will be given to all who are willing to labour. And in CHAP. IT. — SUBSIDIARY MEASURES FOR RELIEF OF POOR. (§ 1 .) 301 the third place, this appears to be the most frugal and profit¬ able plan : a number of persons living together, will he more easily provided for, and their united work will be more pro¬ ductive, than when they live in separate houses. It is not surprising that this plan, so plausible in itself, and so warmly recommended by many writers, should have met with considerable success ; and that in the course of the last century, it should have been actually carried into execution in many great towns in England and Scotland. But its effects are now ascertained by experience, and it may be shown, from undoubted evidence, that Charity workhouses, in general, have been so far from answering the many excellent purposes which were expected to arise from them ; that, in fact, they have proved the worst of all the methods that could have been devised for remedying the evil in question. Poor-houses, dur¬ ing the first years of their institution, may have proved useful, an effect which may have been partly owing to the greater zeal of the managers during the first enthusiasm of their beneficent exertions, but chiefly because the poor were then unwilling to be admitted into them. As long as this continues to be the case, the terror of being sent to a workhouse diminishes the burden of the poor-tax, in proportion to the number of indigent persons who dread poverty less than the loss of character. It is, in fact, a virtual repeal, as far as it extends, of those laws which should have, long since, given way to better regulations. But, unfortunately, it is the most worthy objects who suffer most from this institution, the effect of which is, to hinder those from receiving support who dread the confinement, or the noise and nastiness, even more than the confinement, of workhouses, and consider the security which they afford against the evils of want, as dearly purchased by the sacrifice of that serenity and peace, which can scarcely be expected to exist where an indiscriminate mixture of individuals of all different habits and tempers are collected together. The dread of in¬ volving themselves in this misery, can hardly fail to keep many poor struggling with poverty, till they sink entirely under its pressure. A most affecting statement of this nature has been 302 POLITICAL ECONOMY. — PART I. — BOOK III. — OF THE POOR. given by Mr. Morton Pitt, in his Address to the Landed, Interest on the Deficiency of Habitations and Fuel for the use of the Poor , published a few years ago, [1798.] Nor are these institutions attended with the advantages which they promise in point of economy. Even in parochial work- houses, and in those which are under the best regulations, the poor do so little work, that the produce of their labour almost escapes notice, while they are maintained at a most enormous expense. Instead of doing more work under one roof, and being fed more cheaply than when dispersed in their several cottages, the reverse appears clearly to be the fact. And, indeed, this is no more than might have been expected from a candid exami¬ nation of the general principles of human nature. It is not reasonable, surely, to suppose, that men deprived of their liberty will work with the same cheerful activity for others, as they would do for themselves, and be contented with the same haixl and homely fare which they would eat with thankfulness at home. It is hope which must sweeten all our labours ; nor will any abundance of the means of subsistence relieve us from that despondency at our state, which must necessarily ensue, where we have no object of pursuit, and no room for fears and doubts. It is chiefly owing to this very circumstance, that the services of slaves are so much more expensive than those of freemen. In Mr. Morton Pitt's Address , some observations are intro¬ duced on the comparative expense of maintaining the poor, in their own houses and in workhouses. They are quoted from a letter to the author by Mr. Davies, of L . . . ,* whose ex¬ tensive and practical acquaintance with subjects of this nature seems to be universally acknowledged. The result, we are told, of his elaborate and minute inquiry, was, that every individual in a workhouse cost the parish a considerably greater sum weekly, than when supported out of the house during the same period. The cause of this inequality he attributes chiefly to the difference in their food. . . . Against County Workhouses the objections are much stronger; * [As the Editor has been unable to neither supply this name, nor give any procure Mr. M. Pitt’s Address, he can quotations from the pamphlet.] CHAP. TT. — SUBSIDIARY MEASURES FOR RELIEF OF POOR. (§ 1.) 303 the buildings, furniture, salaries, everything in short being there on a large and expensive scale, without its being possible to preserve, for any length of time, a system of economy. At first, indeed, there may be a great exertion ; but the novelty being over, few will be found public-spirited enough to continue their attendance and attention to a business in which they are so little interested, and from which they are continually di¬ verted by more important engagements, and more agreeable pursuits. In the meantime, while the expenses of these institu¬ tions are so enormous, the objects whose relief they are intended to accomplish, are wretched, still more even than in parochial workhouses, where they are not condemned to the same state of banishment from their friends and relatives. If such insti¬ tutions are attended with any benefit at all, it can only be the negative one, of operating as a partial repeal of laws, which make still greater depredations on the public resources. All the foregoing observations, it must be remembered, ap¬ ply chiefly to County Workhouses, and must not be extended, without many limitations, to similar establishments in large and populous cities ; in which, probably, there are always a great variety of individuals who could not be disposed of in any other way so properly. This distinction between Town and Country Workhouses is strongly stated in a letter, formerly adduced from Mr. Davies, [p. 302.] ... In these remarks, there is un¬ doubtedly much truth and good sense. But they ought not to have been extended beyond the cases which Mr. Davies de¬ scribes, — those of destitute orphans, and of those friendless and helpless persons mentioned by him ; and in general, it may be safely affirmed, that wherever the poor can be provided for by a weekly supply of money or food, in their own houses, this method is, in many respects, preferable to the other. To those who may turn their attention practically to the state of the poor, more particularly in great towns, some important hints may be suggested by a peiusal ol Voghts Account of the Management of the Poor in Hamburgh, pub¬ lished at Edinburgh in the year 1795. An abstract ol the account, drawn up by the Bishop of Durham, will be found in 304 POLITICAL ECONOMY. — PART I. — BOOK III. — OF THE POOR. the Seventh Report of the Society for Bettering the Condition of the Poor. The success which has attended the efforts of the original projectors of this plan, has far exceeded their most sanguine expectations. The institution was formed in the year 1788, at which time, out of 100,000 inhabitants of Ham¬ burgh, there were about 7000 distressed persons, in want of regular relief, besides an average of 2500 persons in the hos¬ pitals. Since that period, scarce a beggar has been seen in Hamburgh, and the decrease of sickness and mortality has been rapidly progressive. The average mortality was, at first, in the proportion of one to ten ; in 1789, it was greatly reduced ; and it has since gradually diminished to less than one to twenty. The average of all the expenses attending the employment of the poor, for three years ending 1st December 1796, including loss on the sale of manufactured goods, was annually £611. In reviewing the origin and progress of the institution at Hamburgh, the Bishop of Durham has very justly remarked the benefits it has derived from the division of attention, the advantages of which he compares to those resulting from the division of labour in manufactures. “ The division of labour has not produced more extraordinary effects in a well-conducted manufactory, than the division of attention in a well-arranged institution. The giving to every acting member his peculiar and appropriate duty, not interfered in by any other person, as has been done with great effect at Hamburgh, is of the utmost importance in every establishment. Those who have attended much to the conduct of charities, must have had frequent occa¬ sion to regret, that, even among the best intentioned men, more time and more power is often wasted in the counteraction and controversion of petty and trivial measures, than in the further¬ ance of the real objects of the institution. This is the friction , the impediment of action, the obstruction to progress, which it is most essential to prevent ; and it is in this respect, that the benevolent and enlightened founders of the institution at Hamburgh have been peculiarly judicious and successful.”* * \7ieports of the Society for Bettering the Condition of the Poor , No. XL. ; Yol. II. p. 41, third edition.] CHAP. JL — SUBSIDIARY MEASURES FOR RELIEF OF POOR. (§ 1.) 305 After all, it is impossible not to feel some apprehensions about the permanent stability of an institution which requires the active and gratuitous co-operation of so many individuals. The steadiness with which it has hitherto been conducted, does infinite credit to those concerned in its management, and may probably continue unabated while the enthusiasm of the ori¬ ginal projectors remains to animate their exertions. But the most public-spirited and benevolent men are not always the most active and persevering, and it thus often happens that the management of institutions for the poor, of whatever nature, after the first efforts of zeal are passed, fall into the hands of persons indifferent to their interests, and unfit to carry them on. It might be advisable, therefore, if any similar establish¬ ment is formed elsewhere, that the most essential parts of its execution should be committed to men, who are paid for their labour, and at such a rate as to render the employment an object to persons placed in the more respectable conditions of life. The publicity and regularity of the accompts, seem also to have contributed much to the success of the undertaking at Hamburgh. And, indeed, where precautions of this sort are overlooked in any charitable establishment, it cannot but, sooner or later, subside into a mere job. It gives me much satisfaction to learn, by a letter which I received about three years ago, that this very interesting establishment continues still to prosper. The same general views which suggested the plan now under consideration, prompted the execution of a similar establish¬ ment, by Count Rumford, at Munich. The success of this undertaking has been singularly great. But it is unnecessary for me to enter into any details with respect to it, not only because the plan is very generally known, but because a great deal seems to have depended on the particular nature ol the government by which it has been so effectually protected and encouraged. VOL. IX. 306* POLITICAL ECONOMY. — PART I. — ROOK III. — OF THE POOR. [SECT. II. — OF BENEFIT CLUBS, OR FRIENDLY SOCIETIES.] In this review of the attempts which have been made for the relief of the lower orders, I must not omit to mention one, which originated first among themselves, and which promises more real and lasting advantages than all the others put to¬ gether ; I allude to the institutions commonly known by the name of Benefit Clubs, or Friendly Societies. The general object of these institutions is, to secure to the industrious from the surplus, or a part of the surplus, of their earnings, an equivalent resource during their incapacity to labour. This idea, although I have not the least doubt that, in this country, it was the genuine offspring of English good sense and sagacity, was not altogether unthought of by the ancients. Causaubon produces ample evidence to shew, that there were, among the Athenians, and also in the other states of Greece, associations where each member deposited every month, in the common chest, a certain sum, for aiding such of their associates as met with any misfortune. Gronovius, too, seems to prove that the same plan was followed in Borne. The truth is, that the general idea of such establishments, however happy in itself, and important in its consequences, is not of so difficult a nature but that it may be expected to present itself to mankind in every civilized society, where they happen to be pressed by the same evils. From a Memoir by M. Dupont de Nemours, it appears that various establishments of this kind had sprung up spontaneously in clifferents parts of France among the lower orders. Since the commencement of the last century, such institu¬ tions have extended themselves to most parts of Great Britain. Sir Frederic Eden mentions some in the north of England that had existed for a hundred years, and their utility is now so completely established by experience, that the most enlight¬ ened friends of the poor in the southern parts of the island, seem, almost unanimously, to consider them as the happiest of all the expedients which have yet been devised for bettering the CHAP. 11. — SUBSIDIARY MEASURES FOR RELIEF OF POOR. (§ 2.) 307 condition and morals of the lower orders. It appears, also, from the Statistical Accounts of our clergy, that similar establish¬ ments are multiplying fast in Scotland, and that they have been found of great service in preventing labourers and working manufacturers from becoming burdensome. An Act passed in 1793, for the encouragement of Friendly Societies, removed many difficulties to which they had formerly been subject. By this Act it is declared, that such societies are lawful, and it is required that their Rules shall be confirmed by the Quarter Sessions. The advantages conferred by the Act on such societies as have their rules confirmed, are many and important. Prior to this Act, it is said to have happened frequently, that the majority of an occasional meeting, which, by the rules of the society, was competent to make laws, expelled all the absent members, though superior to themselves in number, while the persons thus injured were left without the means of redress. A very extraordinary instance of this is stated to have happened lately, in the case of a society whose rules had not been confirmed : — “ In the neighbourhood of Ealing, a majo¬ rity, composed of the young men of a friendly society, agreed to dissolve the society, and divide the stock, and thereby, at once, defrauded all the old members of that provision for age and infirmity, which had been the object of many years’ contribu¬ tion. A new society was immediately formed of the young persons, and all the old members were left to the parish.”* This very extraordinary fact is stated on the authority of the Society for Bettering the Condition of the Poor, and may be found in the Notes and Observations attached to their First Report. Another essential advantage conferred on such of these insti¬ tutions as have their rules confirmed by the J ustices, was the privilege of their members to carry on their occupations in the most convenient places, without being subject to be removed to the parish of their legal settlement ; an encouragement, how- * [Reports of the Society for Bettering the Condition of the Boor , No. I. ; Yol. I. pp. 10, 11, footnote, third edition.] 308 POLITICAL ECONOMY. — PART I. — BOOK III. — OF THE POOR. ever, which is in a great measure done away by the late Act preventing the removal of all persons till they become actually chargeable. A very respectable writer, accordingly, Mr. Rowland Burdon, has suffered his zeal for Friendly Societies to carry him so far as to censure this Act for granting an extension of the advantages formerly enjoyed by the members of such societies alone. “ The locomotive faculty derived from the certificates of Friendly Societies, is a very obvious advantage, and I was sorry to be obliged to give way to the authority of the Legislature, in the adoption of a general principle of this nature with respect to the poor, by the passing of an Act for the prevent¬ ing vexatious removals, which has taken away, or at least diminished much, this inducement for entering into Friendly Societies.”* The beneficial tendency of these institutions is strongly and very judiciously stated in the paper from which the foregoing observation is quoted : — “ The great desideratum, with respect to the maintenance of the poor, has always appeared to me to be the encouragement of habits of economy, and of a system of periodical subscription towards their own subsistence. Where men derive support in sickness and old age from their individual efforts, in conjunction with those of their neighbours, they pass through the various periods of trial without that degradation which attends parochial relief ; being necessarily amenable to each other for a certain degree of forethought and good con¬ duct, they learn insensibly to be regular in their attention to the earnings of their business, and by acquiring a permanent connexion with their neighbours, they become incapable of those acts of vagrancy which are so wasteful of that main source of national wealth, the labour of the lower orders of the people.”' f These remarks are extracted from a short Memoir, published in the First Report of the Society for Fettering the Condition of the Poor. The paper itself is worthy of a perusal, as it contains some interesting details concerning a Friendly Society at Castle Eden, in the county of Durham, on a scale * [Ibid. p. 10.] + [Ibid. pp. 10, 11,] CHAP. II. - SUBSIDIARY MEASURES FOR RELIEF OF POOR. (§ 2.) 309 adapted for general use ; and exemplifies, strongly, not only how much the poor may be led to do for themselves, but to what a degree of kindness and good fellowship they may be habituated in the management of their common concerns. “ I have learnt with pleasure that, in more instances than one, they have collected little sums among themselves to present to their sick and necessitous neighbours, over and above the allowance from the funds of the society, which, as far as I know, is an effect of philanthropy derived from the insti¬ tution.”* Numberless other testimonies in favour of these establish¬ ments might be produced from other writers who have turned their attention lately to the state of the poor ; and it is by such statements, founded on actual experience, and not by specula¬ tive reasonings, that our judgment may be safely guided in disquisitions of this nature. In truth, amidst the most strik¬ ing discordancy of opinion on almost every other point relating to the maintenance of the poor, I do not recollect a single individual of note who has not acknowledged the beneficial effects of friendly societies, as far as their information has extended. Impressed strongly with these considerations, Mr. Acland, who published in the year 1786 A Scheme for enabling the Poor to provide for themselves , proposed that a general fund should be established on principles in many respects similar to those which had suggested the institutions now under con¬ sideration. This plan is said to have received the approbation of Dr. Price. It has been strongly, though somewhat cap¬ tiously, opposed by Mr. Hewlett ;f and is objected to for reasons not so questionable, by Sir Frederic Eden. Among these, there are two entitled to peculiar weight ; in the first place, that it would operate, in many respects, like a poor-rate ; and secondly , that as the members would be governed by laws not made by themselves, it would want that recommendation * [Ibid. p. 9. | which the Increase of our Poor have been ascribed, & c., Part TIL aect. iii. f [Insufficiency of the Causes to p. 109, se

. TT. chap. vi. p. 256, edit. 1816-1 edit, 1816.] CHAP. IL — OF MIXED GOVERNMENTS. (§2.) 439 Europe where the distinction of noble and not noble is carried no further than the nature of the established government requires it should ; because there the nobility do not, as such , form a caste , or class distinct from the rest of the nation, but only a separate order, by being an integrant part of the con¬ stitution. The prerogatives which the English Peers possess belong to them in their corporate capacity, whereas in other countries, the privileges of the noblesse being attached to them as individuals, are not apparently subservient to any purpose of political utility. In England, besides, the honours and privi¬ leges of the peerage are confined to the head of each noble family ; and, of consequence, the rank of nobility is attached, not to noble descent considered abstractly, but to that situation alone in the state which renders an individual an hereditary legislator. The younger branches of these families, as they have no share in the legislature, are Commoners in the eye of the law ; and as, in the course of a generation or two, they are lost in the general mass of the community, they serve as a link to connect together the interests of the two orders into which our constitution supposes the whole body of the people to be divided. In other countries, where those who have been once ennobled transmit the honours and privileges of nobility to all their pos¬ terity alike, there is no link to connect the nobles with the rest of the nation ; on the contrary, a line is drawn between them which separates them for ever, opposing an insurmountable ob¬ stacle to that harmony of views and interests which forms the principal security of a free Constitution. The civil wars in England, and the usurpation of Oliver Cromwell, compensated, in some degree, for the many miser¬ able consequences they produced, by discriminating, still more strongly than before, the ideas and manners of the English nation from those which were prevalent over the rest of Europe. “ It is consolatory to reflect,’7 says Sir Frederic Eden, u that amidst the desolating effects of civil dissension, the nation got rid of the prejudice, (which had too long pre¬ vailed both in England and on the Continent,) that the pur- 440 POLITICAL ECONOMY.— —PART II. — POLITICS PROPER. 0 suits of trade were incompatible with the advantages of birth/' Hume remarks, from Lord Clarendon, that iC the influence of those ideas which the civil wars introduced, engaged the country gentlemen to bind their sons apprentices to merchants/'* And it has been observed by a late writer, Mr. Chalmers, that “ the civil wars which began in 1640 (unhappy as they were, while they continued, both to king and people) produced in the end the most salutary effects, by bringing the higher and lower ranks closer together, and by inspiring all of them with an activity and vigour that in former ages had no example/' f Having now endeavoured to illustrate some of the charac- teristieal excellences of our Constitution, I shall offer a few remarks on an objection to the division of our Legislature, which was much insisted on by some foreign writers about the period when the French Revolution commenced. If the legis¬ lative power (it was urged) is really composed of three branches, which form constitutional and irresistible checks on each other, and if this division be not merely nominal and nugatory, one of two consequences must inevitably happen in every case where there is a difference in their views ; either that the legislative power must be paralyzed and suspended for the moment, or that the political system must suffer a shock inconsistent with the order and stability of a well-constituted government. The ob¬ jection was probably suggested by the following passage in Montesquieu's panegyric on the Constitution of England, in which, though he has indirectly hinted at the difficulty, he does not seem to have been fully aware of its true solution : — “ The legislative body," he observes, “ being composed of two parts, one checks the other by the mutual privilege of reject¬ ing. They are both checked by the executive power, as the executive is by the legislative. These three powers," he adds, ce should naturally form a state of repose or inaction. But as there is a necessity for movement in the course of human affairs, they are forced to move, but still to move in concert.'’^ As Montesquieu has, in this instance, rather eluded than obviated * [ History of England , Common- f [Estimate, c.iii.p. 44, ed. 1812.] wealth, chap, iii.] + [Esprit des Loix, Liv. XI. c. vi.] CHAP. II. —OF MIXED GOVERNMENTS. (§ 2.) 441 the difficulty which he has pointed out to his readers, it is not surprising that this very vulnerable part of his theory should have presented a stumbling-block to such of them as derived their whole knowledge of our government from The Spirit of Laws ; and accordingly, the objection to which it manifestly leads has been enlarged upon by some foreign politicians of no inconsiderable note. I shall therefore avail myself of this opportunity to point out at some length the mistaken views of our Constitution in which it has originated, more especially as the illustration of this argument will lead me to some criti¬ cisms, which appear to myself of importance, on the theoretical accounts of our government, to be found not only in Montes¬ quieu, but in Blackstone and other constitutional lawyers of our own country, when these accounts are applied to the actual state of our political establishment. The same criticisms may be extended, though by no means equally applicable, to what has been written on this subject by the late ingenious and judi¬ cious De Lolme. Before, however, I enter on this discussion, it is proper for me to observe, that I do not mean, by the remarks I am to offer, to convey the slightest censure on the writings of the eminent politicians I have now mentioned. Indeed, I appre¬ hend it is absolutely necessary for every political student to begin his researches concerning our Constitution, by the perusal of some such general account of it as they have given ; were it for no other reason than this, that their account is the common one given by political writers, and that, on questions of this nature, it is necessary not only to know what is true, but to know what has been thought and said by writers of reputation. In the present case, however, a farther and more important advan¬ tage may be derived from the speculations I refer to ; because, although they are very far from being realized in our present government, yet they bear a certain resemblance to it ; and as they do not distract the attention with a variety of anomalies which exist in reality, they lead the mind, easily and gradually, to a more distinct and just idea of the whole, than we should obtain if we attempted to comprehend so complicated a fabric, 442 POLITICAL ECONOMY. — PART II. — POLITICS PROPER. by examining in detail all the different parts which compose it. From the remarks which are now to be made, it will appear that they have, moreover, a tendency to simplify the subject of our examination, by stating, as separate and distinct objects of attention, parts of the Constitution which are blended together in their actual operation. The difference between the theory of our Government and its actual state, is owing to various causes. 1°. — Many of our ancient laws and forms remain, while the ideas of the people have undergone important changes ; and great alterations have taken place in the relations which different orders of the com¬ munity bear to each other. The two branches, for example, of our legislature still continue to be described in our laws in the same terms as they were formerly in a very different form of society ; terms which certainly are apt to convey to those who look merely at the outside of things, very false ideas of their comparative rank and importance in the state at present. And, accordingly, if I am not much mistaken, they do convey, in general, to foreigners, ideas of a distinction analogous to that suggested by the words 'patrician and plebeian at Rome, or noble and roturier in France. 2°. — There are many essential circumstances in the actual state of our Government, which are not professedly parts of the Constitution, and which are not even mentioned in any of our laws ; nay, some of which are directly contrary to our written laws, and to the plan of our Constitution as it exists on paper. It is sufficient for me to mention as an instance, the indirect influence of the King and Lords in the Lower House. I shall endeavour to point out, as clearly and concisely as I can, some of the most important respects in which the actual state of our Government differs from the theorv ; after which, I shall offer a few remarks on the circumstances by which these differences have been produced, during the long period which has elapsed since its great outlines began first to attract the notice of the world, in the rough but bold and original draft of our barbarous progenitors. i.— -In the theoretical accounts of the Constitution, it is always * V CHAP. II. — OP MIXED GOVERNMENTS. (§ 2.) 443 supposed that the three branches of the legislature are per¬ fectly distinct from each other ; and that the preservation of the Constitution depends on the different directions, and the relative proportions of these three powers. All this is perfectly agreeable to the language of the Constitution ; for it ascribes to each of the branches an absolute negative on the determina¬ tions of the two others. But is this really the fact P or will any man pretend, that each of the three branches can exercise the veto with equal effect and equal advantage ? With respect to one branch of the Legislature, the King, it seems now to be an acknowledged fact, that he never can exercise his negative without endangering the public tranquillity. The last time it was exerted was in the year 1692, by William III., who at first refused his assent to the Bill for Triennial Parliaments, but was prevailed on to sanction its enactment two years after¬ wards.1 The power, indeed, vested in the sovereign, of dissolv¬ ing Parliament at pleasure, amounts to a virtual negative on those acts of the legislature of which he disapproves ; but this prerogative, it is manifest, wherever it accomplishes its object, supposes the voice of the people (to whom the appeal is made) to be at variance with the measures of their constitutional re¬ presentatives. It must, therefore, be evidently an experiment, fraught with danger to those legitimate authorities, whose pro¬ ceedings are thus subjected to the immediate discussions and censures of an inflamed and unthinking multitude. The power of dissolving Parliament, accordingly, is pronounced by Mr. Burke in one of his ablest and most judicious productions, to be “ of all the trusts vested in his Majesty, the most critical and delicate.”* “ It is an experiment full of peril to put the representative wisdom and justice of his Majesty’s people in the wrong ; to set up the representative and constituent bodies of the Commons of this kingdom as two separate and distinct powers, formed to counterpoise each other, leaving the prefer¬ ence in the hands of secret advisers of the crown. 1 De Lolmo, [On the Constitution of the Throne , Works } Vol. III. p. 525, England , Book II. chap. xvii. p. 400, edit. 1852.] ♦•rlit. 1816.] •* [Motion relative to the /Speech from t [Ibid.] 444 POLITICAL ECONOMY. — PART II. — POLITICS PROPER. In ancient times the case was widely different. At the close of one session. Queen Elizabeth (as we are informed by D’Ewes) gave her assent to twenty-four public and nineteen private bills, and at the same time rejected forty-eight which had passed the two Houses of Parliament.1 Ho fact can illustrate more strongly the change which has since taken place in the practical spirit of our Government. With respect to the House of Lords, it is equally evident, that if they were to attempt to oppose their negative to the decided wishes of the King and Commons, it would be impossi¬ ble for them to render their opposition effectual. Against such an event, indeed, some security is provided by the Constitution in the King’s prerogative of adding at pleasure to the number of the peerage ; but abstracting from all considerations of this sort, the truth is, in the present state of things, that the minis¬ try (if they are understood to carry the sovereign along with them cordially in their measures) may reckon with confidence on the support of a majority of the peers. And even were the fact, in any extraordinary combination of circumstances, to turn out otherwise, the Upper House could oppose but a shadow of resistance to the combined strength of the two other branches of the Legislature, supported as they always must be by public opinion, when their views happen completely to coincide. “ As to the House of Lords,” says Mr. Hume, “ they are a very powerful support to the Crown, so long as they are, in their turn, supported by it ; but both experience and reason shew that they have no force or authority sufficient to maintain themselves alone, without such support.”* If these observations be just, it necessarily follows, that neither the King nor the House of Lords possess now that in¬ dependence and co-ordinate importance which our popular language and popular theories ascribe to them ; and, conse¬ quently, that the whole practical efficiency of our Government is either centered within the walls of the House of Commons, or operates by the intermediation of that assembly. 1 Blaclcstone, Yol. I. p. 184. * [ Essays, Yol. I. — Essay, Of the Independency of Parliament .] CHAP. II. — OF MIXED GOVERNMENTS. (§ 2.) 445 Agreeably to this view of the subject, it was long ago re¬ marked by Mr. Hume, that u the share of power allotted by our constitution to the House of Commons, is so great, that it absolutely commands all the other parts of the Government.”* “ How much,” says he, u would it have surprised such a genius as Cicero or Tacitus, to have been told, that in a future age there should arise a very regular system of mixed Government, where the authority was so distributed, that one rank, when¬ ever it pleased, might swallow up all the rest, and engross the whole power of the Constitution. Such a government, they would say, will not be a mixed government. For so great is the natural ambition of men, that they are never satisfied with power ; and if one order of men, by pursuing its own interest, can usurp upon every other, it will certainly do so, and render itself as far as possible absolute and uncontrollable. iC But in this opinion,” he adds, “ experience shews they would have been mistaken. For this is actually the case with the British Constitution.”f Shall we therefore conclude, that the whole theory of our Constitution, as commonly stated, is a mere chimera ; and that the three powers, of which so much has been said, have no real operation P By no means. The common theory of our Con¬ stitution is perfectly sound in its fundamental principles, although it requires a more full development than is to be col¬ lected from the general outline of it delineated by systematical writers. The three powers which have been so long regarded as the distinguishing feature of the English plan of policy, do all exist in fact, and all operate in a most, effectual and impor¬ tant manner, but not in the manner expressed in our laws, or in general supposed by our speculative politicians. In conse¬ quence of the changes which time has produced, they do not now , as formerly, operate separately and ostensibly ; but re¬ straining and modifying each other’s effects, they operate in a manner not so palpable, though equally real, by being blended together in the composition of the House of Commons ; an assembly which is no longer composed of men whose habits and * [Ibid.] t [Ibkld 446 POLITICAL ECONOMY. — PART II. — POLITICS PROPER. connexions can be supposed to attach them exclusively to the people, but of men, some of whom, from their situation, may be presumed to lean to the regal part of a government, others to the aristocratical ; while, on important questions, the majo¬ rity may be expected to maintain the interests of the commu¬ nity at large. To illustrate this, it may not be improper to consider of what descriptions of persons the two Houses of Parliament are at present composed ; which, when compared with the original composition of those Houses, will at the same time clearly point out the cause of the great difference that exists between the actual state of the Constitution, and the language and forms handed down to us from our ancestors. This discussion is the more necessary, as the solution given by Mr. Hume of the paradox , just quoted from his works, (although unexceptionable as far as it goes,) is stated in terms much too concise and general, to convey complete satisfaction to those who have not corrected their theoretical views of our Government, by an attentive study of this singular machine in its actual movements. “ How,” he asks, a shall we resolve this paradox ? And by what means is the House of Commons con¬ fined within the proper limits, since from our very Constitution it must necessarily have as much power as it demands, and can only be confined by itself ? How is this consistent with our ex¬ perience of human nature ? I answer, that the interest of the body is here restrained by that of the individuals, and that the House of Commons stretches not its power, because such an usurpation would be contrary to the interest of the majority of its members.”* The question, however, still recurs, how does all this happen, and to what causes is it owing that the theory of our Constitution, which we know was in former times nearly realized, should now be so little applicable to its practical ad¬ ministration P The truth, I apprehend, will appear from the following observations to be this ; that in the present, as in numberless other instances, the natural course of events, un¬ fettered in this fortunate country by those restraints which, in * [Ibid.] CHAP. II.— OF MIXED GOVERNMENTS. (§ 2.) 447 other parts of the world, cramp the energies of the human mind, lias gradually and insensibly adapted our existing institutions to the varying circumstances of a progressive society, and has thus preserved their original spirit, even where they appear on a superficial view to be most incompetent to their end. In the earlier ages of the English history, it is of essential importance for us to recollect, that the Peers comprehended the great nobility and principal proprietors of the country, and formed not only the nominal, but the real aristocracy of the state. The House of Commons, on the other hand, was com¬ posed of men who were really of the plebeian order — of mer¬ chants and traders, and gentry of small fortunes. In one of the ancient writs, they are described as follows : — “ Dubbed Knights, or the most worthy, honest, and discreet Esquires in each county, the most expert in feats of arms, and no others ; and of every city two citizens, and of every borough two Bur¬ gesses, discreet and sufficient, and such who had the greatest skill in shipping and merchandizing.” Even so far down as the time of Edward III., (during which reign, by the way, they seem first to have formed a distinct body,) they appear to have been summoned for no other purpose than to assess aids of money, and to present humble petitions with respect to their grievances. In the year 1332, we find this prince retaining his lords and councillors to advise him in some matters of moment he had to propose to them, after he had dismissed the representatives of the people ; and a few years afterwards, they themselves declined giving their advice upon the Ardua Regni , promising u to confirm implicitly the advice of the nobles, con¬ scious of the weakness of their abilities to advise the best.” “ The petitions of the Commons,” says Mr. Christian,1 “ fre¬ quently began with, ‘ Your poor Commons beg and pray,’ and conclude with, c for God’s sake, and as an act of charity.’ It appears, that prior to the reign of Henry V., it had been the practice of the kings to add and enact more than the Com¬ mons petitioned for. In consequence of this, there is a very memorable petition from the Commons in 2 Henry V., which 1 Notes on Blaclcstone, Vol. !. p. 181. 448 POLITICAL ECONOMY. — PART II.— POLITICS PROPER. states, that it is the liberty and freedom of the Commons, that there should be no statute without their assent, considering that they have ever been as well assenters as petitioners ; and, there¬ fore, they pray that for the future there may be no additions or diminutions to their petitions. And in answer to this, the king granted, that from henceforth they should be bound in no instance without their assent, saving of his royal prerogative to grant and deny what he pleased of their petitions.”1 The same author adds, that “ it was long after its creation, or rather separation from the barons, before the House of Commons was conscious of its own strength and dignity and such was their modesty and diffidence, that they used to request the Lords to send them some of their members to instruct them in their duty, “on account of the arduousness of their charge, and the feebleness of their own powers and understandings.” 2 At present, it is hardly necessary for me to remark how much the case is altered in both Houses. In the Upper House there are peers, who, so far from possessing great landed pro¬ perty, are supported by the bounty of the Crown. Nay, it is not unusual, on the creation of new peers, for the king to assign to them pensions, for the express purpose of enabling them to support their dignity. Nor are all the members of this House men of illustrious descent ; for many of them have been raised from a very obscure origin, in consequence of their public services, or their address in courting ministerial favour ; and, therefore, the condition of a peer of Great Britain neither implies the possession of landed property, nor the distinction connected with ancient ancestry. If we examine the House of Commons, we find that a change no less remarkable has taken place in its composition since the period of its first institution, for there we find individuals of the oldest families in the country, possessing landed estates of £20,000, or £30,000, or £40,000 a year. We find in the same House, men who, even in the order of precedence , are superior to the majority of the House of Lords. Such, for example, as the eldest sons of Dukes, who are commoners in the eye of the law, and yet who have the 1 Christian — ubi supra. 2 Ibid. 449 CHAP. II. — OF MIXED GOVERNMENTS. (§2.) right of precedence by Act of Parliament over every Peer under the rank of Marquis. With these men are united, in the same House, a few of the more eminent merchants of England, — a few lawyers, (who consider a seat in it as putting them in the way of professional preferment,) — a great many sons and younger brothers of peers, — a number of country gentlemen of independent fortune, and a few individuals of splendid abilities, introduced by the influence of the Crown, or of the great families. From the account which has been given of the composition of this assembly , it is evident that both King and Peers must possess a very great indirect influence on its proceedings ; and, in so far as the one or the other influence prevails, the actual state of the constitution leans to Monarchy or to Aristocracy. If the Crown disposed of all the seats, the Constitution, under the forms of a mixed government, would be a pure Monarchy ; or if, on the other hand, the Peers disposed of all the seats, the Con¬ stitution, under the same forms, would be a pure Aristocracy. It was formerly shewn, however, [supra, p. 443, seq.,] that the dif¬ ferent parts of our constitution cannot, in the present state of things, operate as checks on each other, in the way that our con¬ stitutional laws suppose, and that the whole efficiency of govern¬ ment must necessarily be in the House of Commons. If the Crown and Peers, therefore, had no influence in that House, the constitution, under the forms of a mixed government, would be a pure Democracy ; whereas, if each has a certain influence, the three powers may balance each other, and may produce the happy result aimed at in the theory of our constitution, in a way still more advantageous than if it were exactly realized, by saving the machine of government from those violent shocks it must occasionally suffer if king, lords, and commons were openly and avowedly to draw, in any instance, in different directions. The perfection of our government, while its present forms continue, consists in properly balancing these influences, by giving to the Sovereign a sufficient degree of parliamentary weight to produce a general support to public measures, without an implicit confidence in ministers ; — to the Aristocracy such VOL. IX. 2 F 450 POLITICAL ECONOMY. — PART II. — POLITICS PROPER. a weight as may be necessary to secure a due respect to landed property, and to ancient establishments ; — and to the People such a preponderance as may enable them to secure equal liberty and impartial justice to every subject, without permit¬ ting them to run into the extravagances of popular tumult and violence. How far this description is realized in the actual state of our Government we have not at present leisure to examine. In the opinion of some very eminent politicians, “ a new principle of autlioi'ity (unknown to the constitution before) may be traced from the time of the Revolution/' “ Before that period,” (it has been remarked,) “ the friends of liberty dreaded only the direct encroachments of the prerogative ; they have since learned to entertain stronger apprehensions of the secret motives of interest which the Crown may hold up to individuals, and by which it may seduce them from the duty which they owe to the public.”1 On this subject, it was long ago remarked by Sir William Blackstone, (and the observation has been still more forcibly stated by various writers since his time,) that “ if the instru¬ ments of power are not so open and avowed as they formerly were, they are not the weaker on that account ; and that our national debt and taxes have, in their natural consequences, thrown such a weight of power into the executive scale of government, as we cannot think was intended by our patriot ancestors, who gloriously struggled for the abolition of the then formidable parts of the prerogative, and by an unaccountable want of foresight, established this system in its stead.” In this observation it cannot be denied, that there is much and very important truth ; but it does not atfect the justness of the speculative , or rather the hypothetical principle, which I have been attempting to establish, that supposing the indirect in¬ fluences of the king and of the peers to be carried no further than is necessary to preserve a due balance among the three powers essential to our constitution, — so far from being abuses, they seem to be absolutely requisite for preserving the ancient spirit of our mixed government under the important changes 1 Millar’s English Government , Vol. TV. p. 95. CHAP. II. — OF MIXED GOVERNMENTS. (§2.) 451 which time has produced in the condition and manners of the different orders of the community. On these grounds, therefore, I am strongly inclined to agree with Mr. Hume, that “ instead of asserting absolutely that the dependence of Parliament, in every degree , is an infringement of British liberty, the country party should have made some concessions to their adversaries, and have only examined what was the proper degree of this dependence , beyond which it became dangerous to liberty.”* If this moderate language had been less suited to the purposes of a political party, it would at least have had a fairer chance of being substantially useful to the public. The further prosecution, however, of this argument would be altogether foreign to my present purpose, as it is not on any speculative or dubious views of the constitution that I would wish to rest its substantial and characteristical merits. I have repeatedly observed, that forms of government are of import¬ ance chiefly, as they lead to wise systems of internal policy, or, as I have elsewhere expressed it, “ the only infallible criterion of the excellence of a constitution is to be found in the detail of its municipal code.”f Judging by this test, by the actual effect of the government in securing the happiness and promoting the improvement of its subjects, the English Constitution is un¬ questionably entitled to a preference over all those which have been hitherto realized in the history of mankind. “ During the last sixty years,” says Mr. Hume, in an Essay published in 1752, and the remark may be now repeated, with all the addi¬ tional sanction of our subsequent experience, “ during the last sixty years,” (or rather, we may now say, since the beginning of the last century,) “an uninterrupted harmony has been preserved between our princes and our parliaments. Public liberty, with internal peace and order, has flourished almost without interrup¬ tion, — trade and manufactures and agriculture have increased, — the arts and sciences and philosophy have been cultivated, — * [j Essays, Vol. I.— Essay, Of the of Adam Smith, 1793, sect. iv. ; infra, Independence of Parliament.] \o]. X. p. 55.] f [Account of the TAfe and Writinr/s 452 POLITICAL ECONOMY. — PART II. — POLITICS PROPER. even religious parties have been necessitated to lay aside their mutual rancour, and the glory of the nation has spread itself all over Europe. ... So long and so glorious a period no nation can boast of ; nor is there another instance in the whole history of mankind, that so many millions of people have, during such a space of time, been held together in a manner so free, so rational, and so suitable to the dignity of human nature/'1 I have now finished the plan which I proposed to myself at the opening of this Course of Lectures ; and in the last part of it have introduced some discussions concerning various ques¬ tions of Political Economy,* which I have generally reserved for a more advanced class of students. I could have wished, before taking my leave, to indulge myself in a short retrospect of the principal subjects to which I have endeavoured to draw your attention ; but this it is impossible for me now to attempt, without trespassing more than would be proper on your time and patience. The field we have surveyed together is indeed an ample one, and comprehends the most interesting ques¬ tions which can possibly employ the human faculties. If my ability to do justice to these questions had corresponded in any degree to my wishes, or to the idea with which I have been uniformly impressed of the peculiar importance of that station which I hold in this University, I should now close the labours of this session, not only with the agreeable recollection of the hours which I have spent in reviewing once more the funda¬ mental principles of a favourite study ; but with the satisfaction of having discharged a duty of as extensive an utility as most individuals in the private situations of life can be called on to execute. And now, gentlemen, when the connexion is to be dissolved which has for some months past subsisted between us, may I 1 Essays, Yol. I. — Essay, Of the Pro- at the end of, but in connexion with his testant Succession. general Course of Moral Philosophy. * [There are extant two conclusions Of these conclusions, the one here given to the Lectures on Politics Proper; is dated 18th April 1808; the other which Lectures, it will be remembered, marked as for the Session 1803-4, will were always delivered by Mr. Stewart be found in the Appendix, p. 459.] 453 CHAP. II. — OF MIXED GOVERNMENTS. (§ 2.) not be permitted to express the hope which I am encouraged to entertain by the attention with which you have honoured me : that, long after the period of your academical education, you will recollect with satisfaction these studies of your youth ; and that by fixing in some measure your principles concerning the nature, the duties, and the prospects of man, they may con¬ tribute, under the various vicissitudes of fortune that may yet await you, to fortify your virtuous resolutions, to elevate your views above the pursuits of a vulgar ambition, and to cherish in your minds those habitual sentiments of religion, of hu¬ manity, of justice, and of fortitude, which can alone render the talents and accomplishments, (to the cultivation of which so many of your early years have been already devoted,) a source of permanent happiness and honour to yourselves, a blessing to your friends, and a pledge to your country for the perpetuity of that political fabric reared by the hands and ^cemented with the blood of your ancestors, now, alas ! standing alone amid the wreck of surrounding establishments, the last asylum and the only remaining buhvark of the liberties of Europe. — 1 8th April 1808. APPENDICES TO PARTS FIRST AND SECOND. . ■ * ‘ APPENDICES. APPENDIX I.— To B. II. Ch. hi. § 3, p. 114. Quotation on the Exportation of Grain, from Howlett. *•******-•* “ Although I have already, I presume, sufficiently evinced that the influence of all legal regulations, with regard to the imports and exports of grain, is perfectly trifling when compared with the influence of the seasons, as well as the influence of the general state of the kingdom, I would, however, by no means have it con¬ cluded that I think them at all times and in all cases absolutely useless. “There may he occasions in which they are highly expedient. If there be an uncommon scarcity of grain, we must endeavour to procure it from abroad, or run the hazard of starving. If, on the other hand, the domestic produce be so exceed¬ ingly abundant as to sink the price greatly below what the farmer can grow it for, some foreign market must be found, or, from the discouragement thence arising to the culture, it may probably occasion future want. Bounties, too, upon importa¬ tion in the former instance, and upon exportation in the latter, provided the tricks and frauds of merchants and corn-dealers are sufficiently guarded against, may not be improper. In these extreme cases, I think there can be little doubt. But the principal question is, whether, in the intermediate situation of things, legal regula¬ tions, pointing out the exact prices at which exportation and importation should each respectively take place, be absolutely necessary, or even expedient. For my own part, I am rather inclined to think that the whole might safely be left to the natural course of things, and that a free unrestrained trade would be attended with no permanent evil. “ Were there no general prospect of either exportation or importation, the home consumption would be the sole object regulating the growth ; the farmer would always endeavour to raise it as long as it were worth his while, and no laws could induce him to do it any longer. Whatever he finds most profitable he will turn his attention to, be it corn, hops, or cattle ; and this in time will inevitably produce a general level. Variety of seasons, as better suiting the one or the other, will, in¬ deed, occasion frequent vibrations of the balance, but all will finally tend to restore and preserve the due equilibrium. And I much question whether any of the corn laws, through the whole of the present century, have occasioned a single acre more or less to be sown, with any species of grain, than would have been had no such laws ever existed.” — Dispersion of the Gloomy Apprehensions, See., by the Rev. John Howlett, p. 37. 458 APP. II. — TO PART I. — CONCLUSION OF POLITICAL ECONOMY. APPENDIX II.— To Part I., p. 326. A Conclusion of the First Three Boohs of Political Economy , — strictly so called. I intended, before concluding my Lectures on Political Economy, to have marked out a plan of reading on the different subjects which have been under our review. But this, time will not allow me to attempt at present ; and I regret the omission the less, that an enumeration of a long list of books might, not improbably, have had the effect (at least with my younger hearers) of distracting the attention, by leading to the perusal of a multiplicity of discordant and inconsistent theories. I shall therefore confine myself to a few authors whose works appear to me most likely to be useful to you in the farther prosecution of these studies. On the first Article, (that of Population,) I formerly recommended the Disser¬ tation of Dr. Wallace, On the Numbers of Mankind; and the Essay of Mr. Hume, Of the Populousness of Ancient Nations. In France, the chief writers on Popu¬ lation are Moheau and Des Parcieux, and the Marquis de Mirabeau, in his Ami des Homrnes. Of a voluminous Treatise on Population, written in German by Mr. Suessmilch, I am sorry I cannot speak from my own knowledge ; but by many very competent judges, both among English and French politicians, it is mentioned as a performance of extraordinary merit, distinguished equally by the correctness of the author’s researches into facts, and the soundness of his general principles. I am almost ashamed to add, that I am ignorant whether this book has or has not been yet translated into English. In our own language, a great work, On the Principle of Population , has been lately published by Mr. Malthus. At the time I wras treating of that subject, I had looked into the second edition in a very slight and cursory manner ; but I have since perused great part of it with much attention, and I am happy to add my warmest testimony in its favour to the uncommon marks of approbation which it has already received from the public. With some of the author’s general views, indeed, l cannot agree ; but they are always distinguished by ingenuity, and f requently by justness and depth ; and he has had the merit (in addition to the extensive and seemingly accurate information which he has collected in the course of his own travels) of giving connexion and arrangement to an immense accumulation of in¬ sulated facts, which formerly lay scattered and useless in the miscellaneous volumes of preceding writers. With respect to National Wealth, 1 have all along recommended, and must beg leave again to recommend, Mr. Smith’s Inquiry, as the book with which the student may, with most advantage, begin his researches on this subject ; not only on account of the comprehensive outline it exhibits of its various parts, but as it is the Code which is now almost universally appealed to, all over Europe, as the highest authority which can be quoted in support of any political argument. — The work of Sir James Steuart, too, [ Inquiry into the Principles of Political (Economy ,] besides some ingenious speculations of his own, contains a great mass of accurate details, (more particularly with respect to the state of foreign nations,) ascertained by his own personal observation during his long residence on the Continent. — Turgot’s Reflections on the Formation and Distribution of Riches, form a beau- API\ Ill. TO TART II.- CONCLUSION OF POLITICS PROPER. 459 t.iful outline of the fundamental principles of that branch of the science, according to the doctrine of the Economists; an outline which may be afterwards filled up by a perusal of Merrier de la Riviere’s Natural and Essential Order of Poli¬ tical Societies, and of the collection published by Dupont under the title of Physiocratie. In this very difficult department of economical knowledge, a work has just ap¬ peared by the Earl of Lauderdale, [1804,] which, from the great abilities and exten¬ sive information of the author, cannot fail to throw many new and important lights on the questions it discusses. My time has not yet allowed me to give it a complete perusal ; but I have read enough to be satisfied that some of those doctrines which are at present very generally received as elementary truths, require a new and a more accurate analysis than they have yet been subjected to. Various criticisms, in particular, which he has offered on the systems both of Mr. Smith and of the Economists, (more especially those in the chapter which treats Of the means of augmenting Public Wealth, and the Causes that regulate its increase,) deserve the serious examination of all those who are disposed to attach themselves exclusively to either of these authorities, and open some very original views on a subject equally interesting and abstruse. On the much agitated topic concerning the Legislation of Grain, it gives me pleasure to observe, that a new edition has just been published of the truly valu¬ able and very scarce collection, entitled Corn Tracts ; ascribed by some to the late Mr. George Grenville, but now known to be the work of an English gentleman of the name of Charles Smith. This edition, I understand, contains some additional papers relative to the controversy.* On the last articlef which has been under our consideration, that of the State of the Poor, it is unnecessary for me to particularize any work, but that of Sir F. Morton Eden, [in three volumes quarto, 1797,] which maybe considered as a sort of Thesaurus or Digest of all the most important facts and speculations which have been hitherto laid before the public ; not only with respect to the Poor-Laics in these kingdoms, but with respect to many collateral questions connected with that branch of legislation. It contains, besides, a very complete list of the publi¬ cations of his predecessors in the same line of study. — 13 th April 1804. APPENDIX III.— To Part II., p. 452. An earlier Conclusion of Politics Proper. With these very slight remarks on the English Constitution, I shall for the present close our Political speculations, and at the same time conclude the acade¬ mical business of this Session. A review of that plan of polity under which we our¬ selves have the happiness to live, seemed to me to form ( more particularly in such times as the present ) the most useful and practical termination I could give to the discussions in which we have so long been engaged in this place. As the leading * [This collection, entitled Three Tracts on the Corn Laws, was first published in 1758 and 1759. It was reprinted in 1804, with a Life of the Author by George Chalmers. Charles Smith was born 1713, and died 1 777. J t [The Lectures on Education followed, and they terminated tho course. | 460 APR. III. — TO PART II. — CONCLUSION OF POLITICS PROPER. object of these discussions has been to illustrate and enforce the great duties of life, so the duty of Patriotism , which, among those we owe to our fellow-creatures, certainly holds the most distinguished rank, is that which I was more particularly anxious at this moment to impress on your minds ; by bestowing on those subjects which lead the thoughts to the obligations it imposes, all the occasional interest which may arise from the circumstance of our approaching separation. A sacred and uniform regard to this duty leads, in truth, more than any of our other social dispositions, to a conduct wise, manly, and beneficent ; and so far from interfering with our more confined attachments, it presupposes and comprehends them all, or rather springs up from them, as from its proper root. “ Cari sunt parentes, cari liberi, propinqui, familiares ; sed omnes omnium caritates Patria una complexa est : pro qua quis bonus dubitet mortem oppetere, si ei sit profuturus ?” * It was with this view chiefly, that I have employ ed my last Lectures in illustrating the peculiar ex¬ cellencies of the English Constitution ; satisfied as I am that a faithful delineation of its fundamental principles affords the strongest motives that can be suggested for our exertions in transmitting it as far as lies in our power unimpaired to our posterity. I once intended, before taking my leave, to have resumed a subject which I left unfinished, when it was formerly under our consideration ; I mean a review of the principal causes which have hitherto retarded the progress of the Sciences. But this your time renders it impossible for me now to undertake ; and, indeed, I flatter myself, that after the inquiries in which we have been so long engaged together, any additional illustrations of the object and spirit of the inductive philosophy would be, in a great measure, superfluous. It has certainly been my uniform aim to exemplify its rules to the utmost of my ability, founding my reasonings on facts alone ; and checking myself whenever I was conscious of a disposition to depart from the genuine interpretation of nature. This inductive plan of philosophizing I was anxious to recommend, not only as the sole avenue which leads with certainty to the truth, but as the only effectual preservative against that miserable perversion of the understanding which blinds it to the perception of the wise and beneficent order of the universe. It is beautifully remarked by Dr. Ferguson, that “ the foundat ions of religion are laid in the genuine lessons whether of physical or moral science ; and are to be met with in the concluding observations of Newton’s Prin- cipia , no less than in the remains of Socrates, or of Epictetus, or of Marcus Aurelius. In the one it is the suggestion of fined causes , or of an arrangement in the works of nature, for which mechanism alone will not account. In the other it is the result of minds devoted to the government of wisdom and the sentiments of benevolence, and who receive with some degree of a congenial spirit, the indications of supreme intelligence and goodness, as they are perceived to operate in the great system of the world.” f It is in this manner that true philosophy furnishes the most effectual bulwark against Atheism ; insensibly moulding our habits of thinking and of feeling in con¬ formity to the systematical operations of infinite wisdom and goodness ; while, on the other hand, just moral impressions concerning the order of the universe and the course of human affairs, afford the best and surest lights to guide our inquiries, * [Cicero, De OJjiciis, Lib..T. cap. xvii . J 1 \ Principles of Moral ami Political Science, Fart 1 chap. iii. sect. 13.] APP. III. — TO PART II. — CONCLUSION OF POLITICS PROPER. 46 l if we should attempt to extend the bounds either of physical or of ethical knowledge. It is not, however, to those alone who look forward to the pursuits of science that I have addressed myself in these Lectures. The greater part of you are pro¬ bably destined for the active walks of business ; and, under this impression, I have uniformly endeavoured, as far as I was able, to direct your attention to studies sus¬ ceptible of a practical application to the great concerns of human life, — whether Providence may allot to you the obscure but important duties of a private station, or may be pleased to call you to the great and arduous scenes of public affairs. In either event, I shall follow you with my affectionate wishes through the various fortunes that may yet await you : — And, believe me, nothing will ever give me greater satisfaction than to hear, that you have carried into the different depart¬ ments of life for which you may be destined, those steady principles of religion, of integrity, and of beneficence which can alone render you happy in yourselves, and blessings to mankind. — 1804. . I N I) E X. Outlines, etc., from the commencement to page 6 of Vol. X. Lectures, etc., from page 9 of Vol. I. to end of Yol. II. Acland, (Mr.,) his scheme touching the Poor, alleged, ii. 309. Adams, (Mr. John,) adduced as to the American Constitution, ii. 385. Adams, (Mr. Quincey,) quoted as to popular Education in Germany, ii. 336. Agriculture, as affecting Population, i. 113-152 ; kinds of farm tenure, 113- 118 ; size of farms, 124-132 ; arable and grazing, comparative profit of, 137, 138 ; estimation of, among the Romans, 140-146; distinction of, as a mere mean of subsistence, and as a competing trade, 141 ; in connexion with Manufactures, 152-183 ; duty of Government to encourage, 181, seq. ; Agriculture and Manufactures, on their relative claims to attention by the statesman, 201, seq. ; progress of, during the eighteenth century, 237, 238 ; number of persons engaged in farming, calculations estimating, 240; affords the foundation of many ex¬ changes of production, 254 ; agricul¬ tural and manufacturing industry, their relative importance, 258, seq. ; these two exhaust the labour of man, 259, 260 ; in what respect pre-eminent over manufactures, 260, 306 ; pro¬ sperity of, dependent more upon steadiness of an adequate, than upon the high amount of the average price, ii. 116. Agriculture, Board of, see County Re¬ ports. Aikin, (Dr. John,) quoted as to the em¬ ployment of children in Manufactures, i. 183, 184 ; on the progress of Inland Navigation about Manchester, in Yorkshire, Lancashire, &e., 241, 242. Akenside, quoted as to the estimation of Agriculture by the Romans, i. 141. Ale, great increase of its consumption, i. 236. Alienation, English statute of, by Henry VII., ii. 202. Allegiance to Government, a writing of Mr. Stewart, now lost, i. 9, 23. America, discovery of its silver mines, effects of, i. 448; United States of Northern, how affected by Manufac- tiu’es, 157, seq.; beneficial influence of Education on the lower orders in, ii. 334, 335, 337. Anacharsis, his opinion in regard to the value of gold and silver, i. 338, 439. Anatocismus, on the laws regarding, ii. 194. Anderson, (James, LL.D.,) his Obser¬ vations , &c., 1777, adduced as to the influence of Manufactures upon Agri¬ culture, i. 177, 178; as to the Corn Trade, ii. 114. Anglican Divines, see England, Church of. Animal food and pasturage, in reference to the support of Population, i. 105, seq. Animals, food being supplied, their multiplication depends on five cir¬ cumstances, i. 60. Anonymous Author, of The Grand Concern of England Explained , quoted touching the l5oor, ii. 273 ; of Essay on the Bight of Property in Land , praises the English Poor-Laws, 281. Antipater, (of Thessalonica,) quoted as to the employment of Water-Mills, i. 191, 192. Apprenticeships, see Corporations. 464 TNDEX. Arbuthnot, (Dr.,) quoted as to the pro¬ portion of the Sexes as born, i. 86, 87 ; adduced’ as to Roman Fortunes, 146, 147, 382 ; as to the Circulation of mouey, 381 ; examples of Prices in ancient Rome, 383, 448. Aristocracy, on, simply, and in general, ii. 352, 353; on, in special, 376-386 ; what is meant in saying that Modera¬ tion is its principle, 379-382 ; in this form of government the nobles should be debarred from trade, 382, 383 ; its corruption, Oligarchy, 384 ; natural, in every community rising from ori¬ ginal differences, 417. Aristotle, on Man as a social animal, i. 18 ; referred to touching Population and Marriage, 68 ; quoted as to the impossibility of perfect friendship to¬ wards more than one object at once, 74 ; his doctrine as to Usury, ii. 146- 148, 152 ; quoted as to the simple Forms of Government, 384, 385 ; al¬ leged to shew that each form of government is proportionally good or bad, 388 ; his Politics referred to, 426. Asgill, (Mr. John, M.P.,) adduced as to an exclusive Territorial Tax, i. 300 ; ii. 239. Assessments periodical, the previous subsidies, and the more ancient Scut¬ age, Hydage, and Talliage, were vir¬ tually a Land-Tax , ii. 227. Athenians, their measure for maintain¬ ing the equality of landed property, ii. 196 ; formed Benefit Clubs, 306 ; on the Athenian Democracy, 362, 364, 403, 404 ; their government serves as Montesquieu’s model of Democracy, 412. Auckland, (Lord,) on the Population of Great Britain in 1779, i. 234. Augustin, (Saint,) quoted as to the Polygamy of the Patriarchs, i. 83. Aulus Gellius, quoted in regard to Celi¬ bacy among the Romans, i. 92. Bacon, (Lord,) quoted as to Leges Le- gum, &c., i. 10 ; his Speech against Purveyors , 118, seq. ; opposed to En¬ closures, 134; as to his calling Edu¬ cation “ the Georgies of the Mind,” 288 ; quoted, with approbation, ib. ; as to the necessity of political institu¬ tions being accommodated a to the character of their subjects, ii. 420. Balance of Powers in the British Con¬ stitution illustrated, ii. 430, 431, 445, 449, 450. Balance of Trade, ii. 23, seq.; 28, seq. , absurdity of, shown by Smith, 31. Ballot, (the thing,) on the expediency of this mode of voting in Republics, ii. 359; adopted by the State of Mary¬ land, 433. Bank Notes, the word commodity mis¬ applied to, i. 436, 445. Baring, (Sir Francis,) how prices are re¬ gulated with reference to Circulation, i. 394, 395, 434, 447 ; opposed to any restriction upon Interest of money, ii. 160. Barrington, (Bishop of Durham,) alleged as to Workhouses and the poor, ii. 303, 304. Barthelemy, (AUbe,) quoted as to the opinion of the ancients touching a tempered Monarchy, ii. 416. Baudeau, (Abbe,) quoted in regard to Productive and Unproductive Labour, i. 278. Beccaria, (Marchese,) referred to as to Crimes and Punishments, i. 49 ; his opinion as to a low Interest for money, ii. 189. 190. Beddoes, (Dr.,) on the use of opium by the poor, ii. 145. Bedford, (Duke of,) in regard to Bills of Enclosure, i. 136, seq. Bell, (Mr. Benjamin,) quoted as to the influence of Manufactures upon Agri¬ culture and Population, i. 158, 176; adduced in the same respect, 169 ; as to the possible increase of agricultural produce in this country, 202 ; on the proportion of our British importation and consumption of grain, in 1801 and previously, 285 ; on the proportion of different kinds of corn consumed in Great Britain, 369 ; on the amount of our importation of corn, ii. 108. Benefit Clubs, on, ii. 306-313 ; the author strongly in favour of, 311. Bentham, (Mr. Jeremy,) his Defence of Usury, ii. 156 ; quoted against the Usury Laws, 164, 165, 168, 170, 172, 194, 195 ; describes these laws in Russia as a dead letter, 181 ; his pro¬ ject to substitute escheat for taxation, 253 ; his Panopticon adduced, 326. Berkeley, (Bishop,) as to the intrinsic value of the precious metals, i. 337 ; his query as to a rapid circulation of money, 379, 432. Berne, (Society of,) their Essays on the Spirit of Legislation quoted, i. 54 ; INDEX. 465 (Republic of,) its substitute for Taxa¬ tion, ii. 212 ; (Canton of,) an example of political happiness and prosperity, 386; its two Legislative Councils, 435. Bills of Exchange, invented by the Jews, i. 41 ; a branch of trade altogether modern, ii. 153. Births, proportion of, to Deaths and Marriages, i. 220, seq. Blackstone, (Sir William,) on the origin of Borough-English, ii. 200 ; quoted in favour of a restraint on Latter Wills, 204, 205 ; quoted, 208, 209 ; his ac¬ count of the English Land-tax, 225 ; of the aids in England called Tenths and Fifteenths, 226 ; adduced as to the practice of the Crown in rejecting Bills from the Legislature, 444 ; touch¬ ing the influences exerted by the other elements of the Legislature on the House of Commons, 450. Blake, (Mr. William,) quoted as to Cur¬ rency, i. 431, 432, 436. Blomefield, (Rev. Francis,) on the scar¬ city of the year 1595, ii. 262, 263. Boivin, (John,) his Latin translation of an Epigram of Antipater quoted, i. 192. Bolingbroke, (Viscount,) quoted as to the operations of nature, i 430 ; as to a na¬ tural aristocracy in communities, 418. Bonar, (Mr. James,) his Notes of Mr. Stewart’s Course of Political Economy Proper employed in the present work, i. xxi.j-se^-TOS; Notes of Mr. Stewart’s conspectus of Smith upon the Mercan¬ tile system, ii. 23-27. Book Societies, effect of, in the cultiva¬ tion of the lower orders, ii. 347. Borough-English, on the origin of, ii. 2°°. Botero, (John,) his claim to be the founder of Statistical science, i. 214. Bottomry, a species of virtual usury, ii. 186. Boulainvilliers, (Count de,) as to Col¬ bert’s injudicious encouragement of Commerce and Manufactures to the disparagement of Agriculture, i. 160. Bounties and Drawbacks, ii. 26, seq., 113, seq. ; Author’s opinion in regard to Bounties not decided, 117-120. Boyd, (Mr. Walter, M.P.,) as to the principle by which the Price ol com¬ modities is regulated, i. 394. Brackenridge, (Dr.,) on the Population of Great Britain during the war in 1756, i. 232. Brand, (Rev. John,) adduced as to the Corn Trade, ii. 137, 138. Breslau, the Bills of Mortality in that city adduced as a valuable authority by Dr. Halley, i. 227. Bridges, (Mr. James, W.S.,) as supply¬ ing Notes of Mr. Stewart’s Lectures on Political Economy, i. xxi., seq., 198; interpolations from his Notes of these Lectures, 198-200, 204-207, 208-211, 253-269, 302-396; ii. 3-47, 108, 109, 111-120, 137-139, 195-210, 254-349. Brienne, (M. de,) his connexion with Turgot, ii. 80. Britain, (Great,) the amount of its Po¬ pulation, i. 232 ; how the distinctions of rank do not here imply any con¬ trast of class or caste, but slide insen¬ sibly into each other, ii. 439, 442, 448, 449. Brougham, (Mr., now Lord,) Review of Lauderdale On Public Wealth , i. 277. Brown, (Dr. John, Author of the Esti¬ mate, ) quoted as to Education, i. 53, 54. Bullion : relation of a coined to a paper currency, i. 346, seq. ; Parliamentary Bullion Report, framed by Mr. Fran¬ cis Horner, Notes of the Author on, 431-452. Burdens upon farm tenants, i. 118-124. Burke, (Edmund,) quoted as to the in¬ terference of the state, i. 17 ; adduced as to the British Corn Laws, ii. 114; holds that the wages of labour have more than kept pace with the expenses of living, 284 ; strictures on his praise of drinking, 314, 319; quoted as to the conflietion of the British King and Parliament, 443. Burnet, (Gilbert, Bishop of Salisbury,) contrasts the English and Scottish Poor-Laws, ii. 286, 287. Bury, Chairman of the Quarter Sessions of, quoted with approbation as to the growth of native timber, ii. 46. Butler, (Bishop,) quoted as to Education, i. 51. Cadastre, or Territorial Valuation, in different countries, ii. 241, 242 ; that of Sardinia, of Bohemia, of the Duchy of Milan, 242. Caesar, (Julius,) quoted in regard to the usage of the ancient Britons touching Marriage, i. 72 ; as to the proportion of population among the Helvetii, 224 ; his description of a British and German pastoral state alluded to, ii. 201. . . 466 INDEX. Call, (Sir John, Bart.,) on the Popula¬ tion of England and Wales, i. 243. Calvin, (John,) his liberal opinion in re¬ gard to Interest or Usury quoted, ii. 155, seq. Campagnoni, (Citizen,) adduced as in favour of Polygamy, i. 92. Campbell, (John, LL.D.,) referred to as to the agriculture of Kent, i. 168 ; his Political Survey of Great Britain , quoted for the statistics of Food and Population in England, 370 ; quoted, ii. 113. Canon Law, opposed to Usury or Inter¬ est, ii. 149. Cantova, quoted as to the polygamy of the Caroline Islanders, i. 86. Capital, the accumulation of stock faci¬ litated by the introduction of money, 397, seq. ; “Money breeds money,” an ancient proverb, 398. Carrington, (Lord,) his speech adduced in regard to the extent of waste lands in this kingdom, i. 202. Cary, (a Bristol merchant,) adduced as to Monopolies, ii. 18. Casaubon, (Isaac,) referred to as to the antiquity of Benefit Clubs, ii. 306. Casaux, (Marquis de,) against the pro¬ ject of an exclusive Territorial tax, i. 301 ; in favour of taxes on consump¬ tion, ii. 252. Cassius, see Dion Cassius. Castlereagli, (Lord,) on the Population of Ireland, i. 100, 245. Cato, (M.,) quoted in regard to the farmer and the merchant, i. 182 ; in regard to usury and interest, ii. 148. Celibacy, regulations against, by the ancient legislators, especially the Ro¬ man, i. 92, 94 ; in modern states, true policy regarding, 95, seq. Censorial Office, abuse of, ii. 366, seq., 383. Chalmers, (Mr. George,) as to the amount of population in England and Wales, i. 99, 243 ; in Ireland, 99, 245 ; quoted in favour of the policy of enclosures, 136 ; adduced as to the history of statistics, 216, seq.; as to the average population of houses in Britain, 217 ; as to the numbers of the population engaged in the various oc¬ cupations and trades, 240, 241 ; as to the progress of inland navigation, 242 ; as to the statistics of Scotland, 246 ; as to the rate of interest in England, 412 ; as to the progress of England in prosperity during the civil wars under Charles I., 413 ; subsequently, 414 ; as to the Corn Trade, ii. 112 ; confir¬ mation of Adam Smith’s doctrine touching the Corn Trade, 117 ; ad¬ duced as to the proportion between the price and produce of grain, 136, 138 ; quoted as to the good effects of the English civil wars, 440 ; noticed as republishing Charles Smith’s Corn Tracts, 459. Chalotais, (M. Carodeuc de la,) his speech on the Corn Trade referred to, ii. 68. Cliamberlayne, (Dr. Hugh,) project for a land bank, and his paradoxical truths, i. 300, 301. Chardin, (Sir John,) quoted in regard to the absolute monarchy of Persia, ii. 396. Charters, (Rev. Dr.,) quoted as to the Scottish poor-rates, ii. 297. Checks, the necessity of, in all human political constitutions, ii. 417, sea., 432-435. Child, (Sir Josiali,) quoted as to mer¬ chants, &c., i. 15, 16; as to monopo¬ lies, ii. 18 ; advocates the reduction of the rate of interest, 189. Children, their employment in factories, its advantages and disadvantages, i. 183-188. China, its over-population, i. 200; esti¬ mates of its population, 232 ; example of, contrasted with that of Holland, 284; rate of interest in, 420, seq. ; in this country there is a land-tax pro¬ portioned to the produce, ii. 246. Christian, (Mr. Edward,) quoted as to the English law of usury, ii. 188 ; adduced as to the English land-tax, 227 ; quot¬ ed as to the history of the House of Commons, 447, 448. Cicero, quoted on the exportation of gold, i. 34, 147 ; as to the priority of Concubinage to Marriage, 70; as to Marriage being the “ Seminary of the Republic,” 79 ; as to the comparative estimation of agriculture and other occupations, 145, 146 ; his opinion as to usury and interest, ii. 148 ; quoted as to compound interest, 194; on the mode of voting in the Roman republic, 358, 359 ; quoted passages from, in regard to forms of government, 416, 417; as to the legislative power in the Roman republic, 435 ; on love of country, 460. Circulation of money, as to the effect of a slow and rapid, i. 378, seq., 437, seq. ; INDEX. 467 contrast of, among the ancient Ro¬ mans, and among our modern nations, 383 ; on circulation with regard to Banks, 431-452 ; the word Circula¬ tion, as a term of Political Economy, derided hy Plume, ii. 219, 220; de¬ fended by the Author, ib. Cities, considerations to he taken into account in reference to the statistics of their population, i. 229, seq. ; less favourable to health and population than the country, ib. Clarendon, (Earl of,) prosperous state of England under Charles I., i. 412 ; adduced as to the liberalizing effects of the English civil wars, ii. 440. Cocceii, (Henry de,) on the foenus nau- ticum, ii. 187 ; on compound interest, or anatocismus, as agreeable to tire law of nature, 194 ; his opinion against the liberty of bequeathing property by Will, referred to, 204 ; his satisfactory defence of Polybius against Grotius, 415. Coin : Coining Metals, how it affects or determines their value, i. 349 ; equi¬ vocal meaning of the term, 377, seq. /See Money. Coke, (Sir Edward,) adduced as to what grains formed the ordinary food of th * English people, i. 368 ; his Household Book quoted, ii. 57. Colbert, his injudicious encouragement of Manufactures, i. 160 ; his mistaken policy in regard to population, 307. Collins, (David, Judge- Advocate in New South Wales,) quoted on the evil effects of drinking, ii. 314-316. Colonus Partiarius, what kind of farm- tenant among the Romans? i. 1 13, seq. Colquhoun, (Peter, LL.D.,) on the po¬ pulation of London, i. 244 ; quoted as to street-banks, ii. 176; as to pawn¬ broking and swindling, 184 ; as to the amount of public charities in London about 1797, 264. Columella, quoted as to the Roman con¬ tempt of civic and pacific occupations, i. 144. Commerce, questions concerning the expediency of restrictions on its va¬ rious kinds, i. 45 ; progress of, during the eighteenth century, 237, 238 ; restraints on, by the Commercial System, ii. 22-47; ancient and mo¬ dern, difference between in point of extent, 151 ; in an aristocracy the nobles should be excluded from trade, Q Q O OOO. Commercial spirit, beneficial influence of, in uniting mankind, ii. 399. Commoner and Roturier, how the words differ in their meaning, ii. 405. Commons, House of, steps of its pro¬ gress in independence stated, ii. 447, 448 ; influence both of the Crown and of the Peers on its composition and proceedings, 449 ; two different influ¬ ences, the direct and the indirect, at different periods operative upon this House, 450. Commons, (Land in common,) how they may be turned to advantage and the increase of population, ii. 141. Competition in Trade, bad effects of dis¬ couraging, ii. 12, seq. ; bad effects of inordinate encouragement to, 20, seq. Compound Interest, see Interest. Conclusion of the Course on Politics Proper, ii. 452, 453; an earlier, 459- 461 ; of the Course on Political Eco¬ nomy Proper, 458, 459. Concubinage, compared with Marriage, in reference to Population, i. 67-82. Constitution, constitutional, unconstitu¬ tional, their meaning in a political acceptation defined, ii. 422, 423. Consumption, taxes on, their advan¬ tages and disadvantages, ii. 252. Cook, (Captain,) quoted as to Poly¬ gamy in the Friendly Islands, i. 85, 86. Corn, prohibition of its exportation, i. 121 ; corn, or whatever constitutes the ordinary food of the people, the best standard of valuation, 361, 362, 364; how this doctrine differs from that of Smith, 364 ; British legislation in re¬ ference to, ii. 112, seq. Corn- Dealer, utility of, in preventing scarcity, ii. 53, seq., 59 ; see Eore- stallers, Regrators, Engrossers. Corn-Tracts, see Smith, (Charles.) Corn-Trade, how to be used in reference to statistics, i. 246, 247 ; a favourite subject of speculation to Political Eco¬ nomists, 446 ; on, in general, ii. 47- 145 ; introduction to, 47, 48 ; inland corn-trade, 48-99 ; popular prejudices in France relative to, commemorated, 69, 70 ; unlimited freedom of, a pallia¬ tive of a dearth, 88, et anteci; this policy sanctioned by a unanimous decision of the Court of Session, the supreme tribunal of Scottish law, 90 ; the reverse of this decided by English Judges, 90-95 ; of the importation of corn for home consumption, 100 109 ; 468 INDEX. advantages of this importation, 100, seq. ; of the exportation of corn for foreign consumption, 110-120; impor¬ tation of corn for exportation, 120 ; miscellaneous observations on, 121- 145. Corporations, evil effects of, ii. 21. Corruptions, the various, of the different simple forms of government, ii. 384. Country, — rural districts more favourable to population than towns, hence an allowance necessary in our statistical estimates, i. 229, seq. County Reports (of Board of Agriculture) adduced as all in favour of leases, i. 115; as generally in favour of large farms, 128, 131 ; as complaining of the inveteracy of local prejudices, 181. Cousin, (M.,) referred to, i. 18. Coverdale, (Miles,) his testimony against the increase of paupers through the Reformation, ii. 261. Cowries, small shells used in Africa and parts of Asia, as coins or measures of exchangeable value, i. 339, seq. Coxe, (Rev. William,) quoted, ii. 13, seq. ; as to education in Denmark, 335, 336. Craig, (Mr. James Gibson,) obligation of the Editor to, i. xxii. Credit, effect of, i. 438. Crumpe, (Dr. Samuel,) his Essay , 1795, referred to as to the influence of Ma¬ nufactures upon Agriculture, and in opposition to Arthur Young, i. 175 ; as to the rate of interest in Ireland, 415 ; favours the anti-usurious laws, ii. 189. Culley, (Mr. George,) referred to in re¬ gard to the artificial fattening of cattle, i. 111. Cultivation, general, how far compatible with originality, ii. 345. Currency, see Circulation. Currie, (James, M.D.,) on the lament¬ able ignorance of the poor in regard to cooking and dietetics, the deficiency of their diet accounting for their diseases, ii. 143, 144, 313 ; on the ignorance of the English poor, 333. Dale, (Mr. David,) adduced and quoted as to the employment of children in manufactures, i. 185-187. Dauhenton, (M.,) his Instruction your les Bergers , quoted, ii. 333. Davenant, (Dr. Charles,) his character as a political arithmetician, i. 215, seq. ; his estimate of the population of England and Wales, 233 ; his praise of Gregory King, 368 ; referred to in relation to the corn-laws, ii. 84 ; in relation to the proportion between the price and produce of grain, 133, seq., 137, 138 ; adduced as to the meaning of ability, 222. Davies, (Mr..) adduced as to Work-houses, ii. 302, 303. Davies, (Rev. David,) quoted as to the price of corn necessarily rising from taxation, i. 197 ; adduced as to the diet of the poor, ii. 144 ; quoted in regard to the same, 319, 320. Davis, (Mr. Thomas, of Wiltshire,) ad¬ duced, ii. 125, 127. Dawson, his Thoughts, &c., adduced in regard to the Corn Trade, ii. 103, 105. Dearth, interpositions of law to remedy, generally injurious, ii. 52, seq.; as shown by a survey of the regulations of different nations, 54, seq. ; dearth of 1799, observations on, 121-140. Deaths, proportion of, to Births and Marriages, i. 220, seq . Debt, National, see Funding System. Defoe, (Daniel,) a pamphlet of his, (' diving Alms no Charity,) adduced, ii. 270. De Lolrne, quoted as to the political influence of the press, i. 27, 28 ; as to the deliberations of a popular assem¬ bly, ii. 363 ; notices an inconvenience in the Tribunitian authority at Rome, 366, 367 ; gives a remarkable quota¬ tion from Machiavel in regard to the history of republics, 372 ; adduced as to the English constitution, in general, 425 ; quoted as to the executive power in England, 427 ; as to the legislative power in a republic, 436 ; against his fellow-citizen Rousseau in regard to the liberty of the English people, 438 ; adduced as to the confliction of the king and parliament, 443. Demand, uniformity of, for a commodity, how determined? i. 361 ; adaptation of supply to demand, how regulated ? ib. Democracy, or Republican Government, on, simply and in general, ii. 352- 354; on, in special, 355-376 ; what, actually existing, it means, 355 ; how defined by Montesquieu, &c., 355, seq.; how limited by the Author, 356, seq. ; how, by Algernon Sidney, ib. INDEX. 469 Demosthenes, quoted as to the Athe¬ nian demagogues, ii. 370. Denmark, good education of its lower orders, ii. 335, 336. Deparcieux, (M. Antoine,) his work, Jessed sur les Probabilites de la duree de la Vie Humaine, recommended in the conclusion to the Course on Poli¬ tical Economy Proper, ii. 458. Despotism, the corruption of Monarchy, ii. 384 ; careful not to make royalty familiar in the minds of the subject, 395. D’Ewes, (Sir S.,) on the rate of interest in England, i. 410 ; alleged from his Journal to shew that in Parliament it was perceived that the only permanent foundation for plenty was a prosperous agriculture, ii. 263 ; alleged, 444. Diet, comparison of, that of the English and Irish peasantry, i. 101 ; on the different grains at various times and places, forming the ordinary food of the people, 368, seq . ; diet of the poor, quotation from Davies upon, ii. 319, 320. Dion Cassius, referred to touching the Roman laws against celibacy, i. 93. Dionysius, (of Halycarnassus,) quoted as to divorce among the Romans, i. 80, 81. Dirom, (Mr., of Muiresk,) bis Inquiry into the Corn-Laivs and Corn-Trade , i. 109 ; on the supposed decline of Agriculture, 238 ; on the effect of alterations in the old Corn-Laws. 247 ; his views in regard to the Corn-Trade opposed by Mr. Howlett, 248 ; the ambiguity of the term value when applied to money has escaped him, 409, 410 ; adduced as to the inland corn trade of England, ii. 54; in re¬ gard to the exportation of corn, 114. Distilleries, tax on, according to the contents of the still, its failure, i. 320, 321 ; ii. 318 ; stopping of, a measure which may be had recourse to in the case of scarcity, ii. 79, 316. Divorce, liberty of, inexpedient, i. 80, seq. Doomsday Book, nature of this Record of a territorial survey, ii. 239, 240 ; its authority, 240, 241 ; etymology of the name, 241; with what care preserved, 241. Dow, (Mr. John, W.S.,) how far his Notes of Mr. Stewart’s Lectures have been available, i. xxi. Drawbacks and Bounties, see Bounties. Drawing and redrawing of Money, a monopoly secured to bankers, on whom is thus virtually bestowed a right of usury, ii. 182. Dudley, (Mr. Bates,) on the English Law of Settlement, ii. 266. Duhalde, (Father,) of the Tartar prefer¬ ence of the youngest son in the suc¬ cession, ii. 200. Dupont de Nemours, (M. P. S.,) adduced in favour of a territorial or land-tax, i. 301 ; ii. 237 ; as to Benefit Clubs in support of the Poor, ii. 306 ; his Collec¬ tion under the title of Physiocratie, re¬ commended in the termination of the course on Political Economy, 459. Dupre, (M. de St. Maur,) on the money value of wheat, i. 219. Dupuy, (M.,) alleged as to the Roman Law in regard to interest, ii. 152. Durham, (Rev. Dr.,) quoted as to the proportion of the sexes as born in England, i. 87. Dutch — a wealthy people, though their means of subsistence are derived en¬ tirely from abroad, i. 255, seq.; ii. 105 ; on the nature and causes of their wealth, 284 ; Scaliger’s Epigram on the Marvels of Holland, ib. ; the example of, not applicable to other countries, 285 ; all traders, and trad¬ ing on lower profits than any other people in Europe, 407 ; as to their asserted destruction of spices in the Moluccas, ii. 50. Earth, the ultimate origin of everything that supplies the wants of man, i. 259 ; how human labour may increase this natural fund, ib. East Indies, our settlements in, what the rate of interest there V i. 419, seq. Ecclesiasticus, that book quoted as to the division of labour, i. 328, seq. Economists, (French,) the inconsistency of this school in regard to modern cookery animadverted on, i. Ill ; their views touching population, 208, seq. ; their definition of “ National Wealth” defended against Dr. Adam Smith, 252 ; certain differences of, from Adam Smith, 253 ; their doctrine of produc¬ tive and unproductive labour, 258, seq. ; that doctrine defended against Smith, 263, seq., 297 ; their system specially considered, 269-308 ; Smith at one with them in regard to the principal fact, that of natural pro- 470 ESDEX. tluction, 270, seq. ; their application of the term unproductive to manu¬ facturing industry opposed by Smith, 272 ; vindicated by the author, 273 ; but, however, this may be consi¬ dered merely a verbal dispute, ib. ; their classification of the different kinds of labour criticised by Smith, 274 ; defended by the author, 274, seq. ; their indistinct explanations have occasioned misapprehension with respect to the nature of manufacturing industry, 282, seq. ; their objection¬ able expressions as to the effect of manufactures, combined with foreign commerce, 283, seq , 303, seq. ; apo¬ logy for their phrases productive and unproductive labour , and national revenue, and for their nomenclature in general, 289, seq. ; this their no¬ menclature defended, and at the same time corrected, 292, 293 ; rectifica¬ tion of their indistinct division of labour into productive and unproduc¬ tive, 294 ; their doctrine in relation to a territorial tax, 295, seq., 297, seq. ; ii. 237, 253 ; their primary ob¬ ject, 302 ; observations on their sys¬ tem, ib. ; hold as a principle that the fund employed in the support of manufacturers, is always equal in exchangeable value to the commodi¬ ties produced, 302, seq. ; this prin¬ ciple criticised, 303 ; their system and that of Smith compared, 306, seq.; their system favourable to na¬ tional prosperity, 307 ; limitation of the author’s praise of their system, 307, 308 ; its principal defects, 308 ; adduced in regard to the Corn Trade, ii. 1 14 ; accused by Gillies of plagiar¬ ism from Aristotle, 148 ; vindicate Usury, 157. Economy, Political, see Political Eco¬ nomy. Eden, (Sir Frederic Morton, Bart ,) quoted as to the employment of chil¬ dren in Manufactures, i. 184 ; as to the use of wheat in the North of England, 249 ; as to the rate of in¬ terest in England, 412 ; quoted as to the growth of native timber, ii. 42, 44, seq.; alleged as to pawnbrokers, 184; quoted, 217; referred to, ib.; quoted as to the evils resulting from sturdy beggars in England, 257, 258; alleged to prove that the number of paupers receiving parish relief, was in a smaller proportion anciently (c. 1600) than in his time, (c. 1797,) 263 ; on the thriving condition of the Eng¬ lish people during the Commonwealth, 265 ; on the ambiguity of the Statute of Settlement, ib. ; confirms Mr. Howlett’s animadversions on Smith and Kames, touching the English Law of Settlement, bis, 267 ; on the state of those parishes which have erected Workhouses, 271 ; on the amount ex¬ pended on the poor in the latter half of the eighteenth century, 273 ; on the good effect of Benefit Clubs or Friendly Societies, in the relief of the poor, 274, 311 ; holds it to he inexpe¬ dient to withdraw from the poor all legal relief, 277, 278 ; have wages in¬ creased with the price of necessaries? 284 ; his work on the poor praised, 285 ; and in the conclusion of the course on Political Economy recom¬ mended for study, 459 ; quoted as to the Scottish Poor-Laws, 291-295; adduced as to the antiquity of Benefit Clubs for the relief of the poor in England, 306; as objecting to Acland’s plan for the support of the poor, 309 ; against legislative interference with Friendly Societies, 310 ; quoted as to the good effects of the English civil wars, 439. Eden, (William,) see Auckland, (Lord.) Edgeworth, (Richard Lovell,) Speech of, in a Committee of the Irish Parlia¬ ment, adduced, ii. 334. Edicts, registering of, in France, in how far a restraint upon regal power, ii. 408, 409. Edinburgh, population of, i. 246. Edinburgh Review, quoted as to Cur¬ rency, i.432, 444, 445, 448, 449 ; ad¬ duced as to the policy of bounties in the Coni Trade, ii. 115. Education — including the prevention, reformation, and correction of crime, a branch of Political Economy pro¬ per, i. 49, seq. ; in antiquity limited to the upper orders, or the free, 52 ; of the higher orders, its importance, 54, 55 ; of females, its importance, 55, 56 ; of the lower orders, in gen¬ eral, ii. 327-349 ; Scottish parochial schools, history of, 328-333 ; in France, 333, seq. ; in Ireland, 334 ; in Switzer¬ land, ib. ; in the United States of America, 334, 335, 337 ; in Denmark, 335, 336 ; in Silesia, 336 ; in the Lancasterian schools, 341, 342. Effective, substituted by the Author for INDEX. 471 the term productive, as applied to dif¬ ferent kinds of Labour, i. 256. Emmet, (Dr.,) on the population of Ire- ^ land, i. 100, 245. Enclosures, on the policy of, i 132-138. Encyclopaedia Britannica , error of, in regard to the Scottish Poor-Laws, noticed, ii. 295. Encyclopedic, French authors of, re¬ ferred to in favour of large farms, i. 127. England, Population of, including Wales, i. 99, seq., 233, 242, seq. ; on the Diet of the English peasantry, 101 ; rate of interest in, at different times, 409-415 ; progress of Prosperity in, 414 ; English House of Commons, opinion of, in regard to pawnbroking, ii. 154 ; Ignorance of the poor in, 333 ; see Poor-Laws, Great Britain. England, Church of, its Divines opposed to Usury and Interest, ii. 150. English Constitution, often misunder¬ stood by foreigners, ii. 404, 405 ; first example of what the ancient politi¬ cians contemplated in theory, being realized with success, 417 ; on, in special, 424-453 ; are the people under it free ? denied by Rousseau, 437 ; asserted by De Lolme, 438 ; Author’s opinion of, in certain essential respects detailed, 440-452. Engrossers, laws against, i. 121 ; who? ii. 55. Entails, effects of, referred to, i. 152 ; the practice of, ii. 197, 203, seq. Erskine, (Mr. John, Adv.,) quoted in re¬ gard to Usury, ii. 188 ; on the Old and New Extents, two Scottish valuations, 233. Euripides, quoted in favour of Polygamy, i. 84. Exchange, see Bills of. Exchanges of production and labour, foundation and nature of, i. 254, seq. Executive Power, ii. 351, 352 ; danger of, how guarded against in the British constitution, 425-427 ; advantages of its unity in the British constitution, 427. Exportation, ( see Importation,) British Bounty Acts in favour of, ii. 113. Extents, Old and New, . the names of two valuations of land in Scotland, ii. 233. Faikman, (William,) his treatise On the / Stocks , adduced, ii. 214, 215. Farmers, properly so called, how they arose, i. 114, seq. Farming, see Agriculture. Farms, size of, i. 124-132 ; ambiguity of the expressions larye and small, in application to farms, 128 ; general maxim touching the proper size of farms, ib. ; on the usual prevalence of large farms, and what this indicates, 240. Fathers, (Church,) unanimous against Usury or Interest, ii. 149. Ferguson, (Dr. Adam,) quoted as to the Habeas Corpus Act and the English spirit of liberty, i. 28, 29; adduced as to the multiplication of animal races, 60 ; quoted as to the Roman laws in discouragement of celibacy, 93, 94 ; referred to on the division of labour, and its effects, 311; quoted fully on the same, 329, seq ; adds a fifth maxim to Smith's four in regard to taxation, ii. 224 ; on Montesquieu’s distribution of political powers, 352 ; on the dis¬ tribution of property in republics, 360 ; on the advantages of Democracy, 361 ; on the meaning of the word modera¬ tion, as Montesquieu’s principle of Aristocracy, 380-382 ; on the virtues of the Spartan Aristocracy, 382 ; quoted in regard to the relativity of political institutions, 421 ; as to the suggestion of Final Causes, 460. Fielding, (Mr Henry,) holds that it would be better to trust the relief of the poor to private and voluntary cha¬ rity, ii. 275 ; on the paucity of Scottish criminals, 333. Fifteenths, see Tenths. Finance, the most effectual means of taxation in modern states, ii. 213. Findlater, (Rev. Charles,) alleged as to the Scottish Poor-laws, ii. 299. Fletcher, (of Saltoun,) cited in regard to the great number of beggars in Scot¬ land towards the close of the seven¬ teenth century, i. 210; proposes to reduce them to slavery, 210, 211. Food, why bread more variable in price than butcher meat, ii. 103. Fordyce, (Dr.,) on the population of Lon¬ don, i, 244. Forestallers, laws against, i. 121 ; who? ii. 55. Forster, (Rev. Richard,) on the popula¬ tion of Great Britain during the war in 1756, i. 232. Fortcscue, (Lord Chief-Justice,) quoted as to the freedom of trade, ii. 19. 472 INDEX. Fox, (Charles,) quoted as to the Habeas Corpus Act, i. 25, 26. France, rate of interest in, at different times, i. 415, seq.; popular prejudices in, touching the Corn Trade, ii. 69, 70 ; French policy in regard to the commerce of grain, 71, seq. ; serves as Montesquieu’s model of monarchy, 410, 412. Francis, adduced as to Tithes, ii. 247. Franklin, (Dr. Benjamin,) adduced as to the progress of population in Ame¬ rica, i. 61 ; quoted as to the stimulus winch may be afforded to industry, 154, 155 ; as defining man, a tool¬ making animal or engineer, 192 ; like the French Economists, considers ma¬ nufactured wares as “ subsistence metamorphosed,” 262 ; quoted in re¬ lation to the doctrine of the Econo¬ mists on this point, 304, seq. ; his opposition to the Mercantile system, ii. 33, 34; sanctions the paradox, that cheap food is an encouragement to idleness, 312 ; a simile of his quoted in illustration of two legislative assem¬ blies, 432. Frederician, or Prussian Code, referred to as to Wills, ii. 204. Frederick, (the Great, of Prussia,) his merit as to the education of the people, ii. 336. Freedom of Trade, on, in general, ii. 3-47 ; against restraints on domestic commerce, 5-22 ; against restraints on foreign commerce, 22-47 ; petition in favour of, by divers London traders, 20. Friendly Societies, see Benefit Clubs. Friendship, can a perfect Friendship subsist towards more than one at once ? i. 74. Froissart, quoted as to Scottish Manu¬ factures, i. 402. Frugality and waste, effects of, in the domestic economy of the poor, i. 321. Funding System, its mischievous ten¬ dency to enhance the market rate of interest, ii. 192, seq.; to depress agri¬ cultural improvement, 193; origin and history of, as a mean of taxation, 213, seq. ; its establishment and his¬ tory in Britain, 215-218; cause of enormous burdens on a country, 218. Gale, (S.,) quoted from bis Second Essay on Public Credit , 1785, ii. 192. Galiani, (Abbate,) against the free com¬ merce of grain, ii. 66, 69 ; merit of his Dialogues, ib. ; adduced touching the British Bounty Act for the ex¬ portation of corn, 113. Gavelkind, Kentish custom of, ii. 198 ; referred to respecting, — Selden, Black- stone, Spelman, Barrington, Tacitus, Gilbert Stuart, A. Young, Marshall, 198, 199. Gellius, see Aulus Gellius. Genesis, Book of, quoted in regard to succession, ii. 206, 207. Geneva, its legislative councils, ii. 435, 436. Genoese, (along with the Venetians,) originators of the Funding System in the sixteenth century, ii. 213. Gentleman and Gentilhomme, how they differ in signification, ii. 405. Gentz, (Herr,) quoted in favour of the freedom of trade, ii. 37, seq. Germans, their laws of succession, ii. 197. Gibbon, quoted as to the Boman facility of Divorce, i. 81, 82 ; in apology of Necker, ii. 87 ; alleged as to usury and interest in ancient Borne, 152 ; quoted as to the advantages and dis- . advantages of Monarchy as a simple form of government;, 387, 388. Gilbert, (Mr.- 'Thomas,) his plan of a limited assessment for the support of the Poor, ii. 278. Gillies, (Adam, Lord,) quoted as to the Habeas Corpus Act, i. 26, 27. Gillies, (Dr. John,) on the supposed plagiarisms from Aristotle’s Politics , ii. 148 ; his Introduction to the Ora¬ tions of Lysias referred to, 426. Gisborne, (Bev. Thomas,) adduced as to the employment of parish children in factories, i. 188 ; as to the effect of machinery in superseding labour, 192, 193. Glasgow Chamber of Commerce, Be- ports of, in reference to the Corn Trade, i. 247. Glasgow Town-Council, Committee of, on the Corn Bill, 1791, adduced, ii. 102, 105. Globe, (World,) comparative population of its different parts, i. 232. Godwin, quoted as to the abolition of Marriage, i. 68, 69 ; his theory of concubinage refuted by its absurdity, 69 ; adduced as to population, 204. Goguet, (President de,) adopted, his division of positive laws, i. 57, 58 ; adduced as to the institution of Mar¬ riage, 71. INDEX. 473 Gold, silver, &c., the most convenient materials for a circulating medium, i. 333 ; why, according to Smith, 335 ; their intrinsic value, as exchangeable commodities, 335, seq.; how, from media of exchange, they came to form the scale of valuation, 344, seq.; the second of these purposes, how far involved in the first, 345 ; objections to the relative doctrine here main¬ tained, 345, seq. ; how their plenty or scarcity affects price, 371-390. Goldsmith, quoted on the natural su¬ periority of those who think over those who toil, ii. 379. Government, Theory of, or Politics Pro¬ per, ii. 351-453 ; simple forms of, in ge¬ neral, 351-354 ; in special, 355-401 ; in theory, Democracy, Aristocracy, Mon¬ archy, 352-354; mixed forms of, on, in general, 402-424 ; on, in special, and particularly of the English Constitu¬ tion, 424-453 ; simple forms of, mere theoretical abstractions, 402, 403, seq.; mixed in contrast to simple forms of, 402, seq. ; every actual government in reality a mixed government, 403 ; its spirit varies at different times though its written laws remain unal¬ tered, 404 ; no form perfect, and all change in, to be beneficial should be slow, 419 ; forms of, do not in general take their rise from political wisdom, 4i9. Grain, low prices of, in former ages, ex¬ plained, i. 383, see 381 ; excessive cheapness of, in 1800, explained, ii. 129, 130; rise in price not proportioned to a deficiency of, 132, seq., compare 84 ; exportation of, quotation from Howlett’s pamphlet touching, 457. Graslin, (M., author of Esscd Analy- tique sur la Bichesse, &c.,) adduced as against the expediency of an ex¬ clusive territorial tax, i. 301. Graunt, (Major,) quoted as to the pro¬ portion of the sexes as born in Eng¬ land, i. 87. Gray, his pamphlet on the land-tax re¬ ferred to, ii. 229. Greeks, their laws of succession, ii. 196, 197. Gregory, (Rev. George,) quoted as to the spirit of the Athenian govern¬ ment under Pericles, ii. 369 ; adduced as to an observation of Tacitus, 395 : as to the impossibility of any stable succession in a despotism, 397. Grey, his Essential .Principles of the Wealth of Nations , adduced as to the extent of Commons and Waste Lands in Great Britain, i. 202 ; his reply to Smith touching the distinction be¬ tween the labour of artificers and that of menial servants, 275, 278 ; this distinction improved by the Author, 275, seq. ; Smith defended against this author, 278, 279. Gronovius, (John Frederick,) referred to touching the antiquity of Benefit Clubs, ii. 306. Grose, adduced, ii. 240, 241. Grotius, (Hugo,) quoted as to the Poly¬ gamy of the Patriarchs, i. 83, 84 ; his translation of an epigram of Anti¬ pater, 191 ; on the feenus nauticum , ii. 187 ; his criticism of Polybius in regard to the form of the Roman go¬ vernment redai’gued, 415. Ground-rents, are even a more proper object of taxation than the rent of houses, ii. 248. Guthrie, his History of England quoted as to the rate of interest, i. 412. Hailes, (Sir David Dalrymple, Lord,) adduced in regard to the old valuation of land in Scotland, ii. 232. Hale, (Sir Matthew,) alleged as to Charity Workhouses, ii. 3U0. Halley, (Dr. Edmund,) his character as a statistical inquirer, i. 215, seq. ; that in a country the proportion of persons able to bear arms is equal to about a fourth of its inhabitants, 223 ; his observations upon the deficiencies of Sir William Petty’s modes of de¬ ducing population, 226, seq. Hamburgh, maintenance of the poor in, commended, ii. 143 ; in this city the interest of money free, 157. Hamilton, (Prof. Robert, LL.D.,) on the Funds, ii. 214 ; referred to, 217. Happiness, the term not employed in the modern acceptation by the Greek writers, i. 56. Harrington, (James,) quoted as to the political wants of the Senate and of the People, ii. 365, 419. Harris, (Mr. James of Salisbury,) re¬ ferred to on the division of labour and its effects, i. 311. Harris, (Mr. Joseph,) adduced as to the history of money, i. 333 ; as to the intrinsic value of the precious metals, 337 ; as to the precious metals con¬ stituting the measure of value, 3 17 ; 474 INDEX. as to liis doctrine of value, 355 ; quoted as to the wages of labour con¬ stituting the real price of commodi¬ ties, 365, 366 ; his doctrine on this point estimated, 366, seq. Harte, (Rev. Walter,) quoted as to Col¬ bert’s injudicious policy, i. 160, seq. ; as to the inveteracy of local prejudices among farmers, 181. Harvest, plenty or scarcity of, should be annually ascertained by public authority, and by what persons ? ii. 131, seq. ; rise of price not in propor¬ tion to a deficiency in grain, 132, seq., compare 84. Hauterive, (M.,) commemorated as an antagonist of Gentz, ii. 38. Heeren, (Prof.,) adduced as to ancient and modern trade, i. 39, seq. Helvetius, quoted touching the ignor¬ ance and stupidity of despotic mon- archs, ii. 390, 391. Henry, (Robert, D.D.,) quoted as to the diet of the English people in the fifteenth century, i. 370 ; his History praised for its statistical information, 371 ; quoted as to the Scottish paro¬ chial schools, ii. 328. Herodian, quoted as to the funeral rites of the Roman emperors, ii. 395. Herrenschwand, (Herr,) adduced in favour of large farms, i. 127. Hertzberg, (Baron Von,) bis Academi¬ cal Discourses adduced as to the history of Statistics, i. 214, 221, 223. II esiod, on the dependence of civilisation (or the arts) on labour, i. 309. Hindostan, its over-popuiation, i 200. Holland, example of, contrasted with that of China, i. 284; Usury legal throughout the United Netherlands, ii. 157 ; see Dutch. Honour, the principle of Monarchy , — what does it mean in the language of Montesquieu ? ii. 408. Horace, quoted as to the institution of Marriage, i. 71, 79. Ilorner, (Mr. Francis, framer of the Bullion Ileport,) alleged, i. 452 ; re¬ ferred to touching the Scottish Poor- Laws, ii. 292 ; a letter of his quoted in regard to Joseph Lancaster and the education of the poor, 341, 342. Houses, Taxes on tire Rent of, ii. 247, 248. Howard, (John, the philanthropist,) ad¬ duced, ii. 326 ; on the paucity of criminals in Scotland and in Switzer¬ land, 333. Howlett, (Rev. John,) as to the popula¬ tion of Ireland, i. 99 ; in favour of large farms, 127, 130 ; adduced in favour of Enclosures, 133; on the aver¬ age population of houses in England, 217 ; against Dr. Price, and in proof of the progressive population of Great Britain, 235, 236 ; on the progress of British Agriculture, 238, 239 ; on the population of England and Wales, (bis) 243 ; on that of London, 244 ; his pamphlet in answer to Mr. Dirom adduced, 248, seq. ; adduced in regard to the exportation of corn, ii. 114, 457 ; against Karnes and Smith in regard to the Law of Settlements, 267 ; defends this law, 269 ; against a limited compulsory support of the poor, 278 ; praises the spirit of the English Poor-Laws, 281, 282 ; causes of the increase of the English poor, 282, seq. ; have the wages of labour increased with the cost, of the neces¬ saries of life ? 283, seq. ; alleged as to the poor, 309 ; quotation from his pamphlet on the exportation of grain, 457. Hume, (David,) quoted as to the end of government, i. 22 ; as to the great im¬ provement of monarchical government in modern times, 43, seq. ; ii. 400 ; his opinion, referred to in regard to the influence of climate upon Population, 61 ; quoted as to the pairing of ani¬ mals and as to marriage, 77 ; the meaning he attaches to the phrases “principles of nature,” and “ laws of nature,” censured, 78 ; referred to as to the liberty of Divorce, 80 ; his Essay on Polyyamy and Divorce praised, 91 ; adduced in favour of Enclosures, 135 ; quoted as to the in¬ applicability of the Roman policy touching Agriculture, to the present state of the world, 143; as to Swit¬ zerland furnishing the most skilful farmers, and the most bungling trades¬ men in Europe, 153 ; holds that trade and manufactures are nothing but the public storehouses of labour, 256 ; corrected in regard to his opinion of the intrinsic value of gold and silver, 338 ; his History praised for its statis¬ tical information, 371 ; his doctrine of prices as corresponding with that of Montesquieu, 373-376, seq. ; his argu¬ ment against banks and paper credit, 385, 386, 431 ; his doctrine touching the rate of interest, 398, seq. ; given INDEX. 475 in detail, 400, 401 ; just for the most part, but too unqualified, 401, seq. ; his doctrine in regard to Interest and Money, alleged, 439, 440 ; quoted in regard to Queen Elizabeth’s patents for monopolies, ii. 17 ; against the Commercial System, 31, seq. ; as to the utility of a high price of grain in seasons of scarcity, 49 ; accused by Dr. Gillies of plagiarizing from Aris¬ totle, 148 ; referred to as to the laws of succession among the Irish, 197 ; on the Statute of Alienations, 202 ; adduced touching taxation, 211 ; quoted against the National Debt, 218, 219; on the term Circulation, 219 ; reconciled with Pinto, 220 ; against the project of an exclusive land-tax, 237 ; his supposition in ex¬ planation of the omissions in Dooms¬ day Book, 239 ; quoted in reference to the Athenian democracy, 364, 403 ; in reference to the wants of the senate and of the people in a democracy, 365 ; praises an observation of Thu¬ cydides, 371 ; how he would remedy the inconveniences of a democratical government, 374, 375 ; objections to liis doctrine on this point, 375, 376; on the best kind of aristocracy, 377, 378 ; quoted as to the uncertainty of political predictions, 413 ; on the English Legislative power, as illus¬ trated by that of Athens, 428 ; as to the seeming political confiiction of a legislative people and a legislative senate, 436, 437 ; as to the mutual support given by the Crown and the Peers in the working of the Constitu¬ tion ; 444 ; holds that the House of Commons seems paramount in the British Constitution, 445 ; but that the three powers are in reality bal¬ anced, ib. ; his solution of the paradox supposed by him in the British Legis¬ lature, 446 ; is the dependence of Parliament an infringement of liberty? 451 ; notices the long harmony be¬ tween our Princes and our Parlia¬ ment, 451, 452; his Essay on the Populousness of Ancient Nations, commemorated in the conclusion ot the course on Political Economy Pro¬ per, 458. Hume, (David, Prof, and Adv., after¬ wards Baron,) his Commentary on Criminal Law, quoted, ii. 332. Huskisson, (Mr.,) quoted as to the cir¬ culation of currency, i. 432, 441. Importation and Exportation, as to their proportion, i. 250 ; freedom of importation, its effects upon the agri¬ culture of a country, ii. 104, seq.; British laws in reference to the im¬ portation of corn, 106, seq. Income-Tax, ii. 253. India, on the low wages of labour in, i. 448. Infancy, long helpless state of, in Man, shows the intentions of nature in re¬ gard to Marriage, i. 73, seq., 76, seq. Interest of Borrowed Money, on, in general, i. 396-425; ii. 146-1 95 ; high and low, according to Hume, depends on three circumstances, 400 ; first, a great or small demand for borrow¬ ing, 400, seq.; second, the quantity of stock which may supply the demand of borrowers, 403, seq ; third, high or low profits arising from commerce, 407, seq. ; low profits and low inter¬ est, how they mutually act and re¬ act, forming the conditions of a flourishing commerce, ib.; a low in¬ terest is the sign of prosperity in a people, 408 ; the author coincides with Hume against Locke, Law, and Mon¬ tesquieu, in holding that the rate of interest does not necessarily result from a plenty or scarcity of the pre¬ cious metals, ib. ; rate of, in England at different times, 410-415 ; interest and usury, on their connexion, really and verbally, 411; legal rate of, in England under the Commonwealth and Charles II. , 413 ; rate of, in Scotland, 415; in Ireland, ib.; in France, 415, seq.; in our West Indian Colonies, 417, seq. ; in the East In¬ dian British dominions, 419 ; in China, 420, seq. ; causes besides the riches or poverty of a country, which influence the rate of interest, 421, seq. ; connexion of this rate with the ordinary price of land, 421 ; effect where the law prohibits, or does not enforce a rate of interest above a limited amount, ib. ; derivation of the word r'ozo? from raw, ii. 147 ; variations of its rate at different times and in different countries, 160, seq. ; policy of fixing a definite rate of, considered, in general, 161-195 ; arguments in favour of that limita¬ tion of interest which has heen fixed by British law, 162, seq ; argument for, drawn from the case of prodi¬ gals, 163-166; from the case of the 476 INDEX. indigent, 166, 167 ; from the case of projectors, 167-173 ; from the case of the simple and inexperienced, 173, seq. ; laws against usury only aggra¬ vate the distress of the unfortunate, 178, seq.; compound interest, laws and prejudices with respect to, are equally ill-founded as those concern¬ ing simple interest, 193-195 ; see Usury. Interpolations from Notes, see Bridges. Ireland, population of, i. 99, seq; 245; on the diet of the Irish peasantry, 101 ; rate of interest in, 415 ; neglected education of the lower orders in, had effect of, ii. 334. Irish, their rules as to the succession of land, ii. 197. Ivernois, (Sir Francis D’,) on Pinto and the public debt, ii. 218. Jefferson, (Thomas,) quoted as to Education in America, ii. 337 ; his Notes on Virginia, quoted as to the necessity of legislative checks, 433, 434. Jenkins, (Henry,) his testimony in re¬ gard to the hospitality of the Catholic clergy, ii. 259, 260. Jenyns, (Mr. Soame,) quoted on the ne¬ cessity of machinery and the consoli¬ dation of farms, as effects of taxation, i. 196, seq. Jews, did they invent bills of exchange ? i. 41 ; in regard to their Usury, ii. 149, 150. Johnson, (Dr. Samuel,) alleged as to the meaning of the word Economy, i. 10 ; his dogmatical assertion in regard to education quoted, 52. Jones, (Sir William,) quoted as to Me¬ nu’s, or the ancient Hindoo doctrine touching usury, ii. 152, 153, 187 ; re¬ ferred to in his Commentary upon Isseus, 197. Journals, influence of these periodical publications in the enlightenment of the people, ii. 343. Judicial Power, ii. 351, 352. Juvenal, quoted in regard to the luxury of the Romans, i. 147 ; as to the love of money increasing with the posses¬ sion of money, 446. Kaempfer, quoted as to the proportion of the sexes in Japan, but his fact controverted, i. 90. Karnes, (Henry Home, Lord,) quoted as to the pairing instinct of animals, i. 77 ; referred to as to the rise of the lower orders in Europe after the fall of the Roman Empire, 113; adduced as to the history and policy of Entails, ii. 203 ; against the English Law of Settlement, as creating a great differ¬ ence in the price of labour in different parishes, 266; defended on this point against certain English critics, 267, 268 ; adduced in reference to the Scottish Poor-laws, 297 ; quoted as to the kingdom of Siam, 392, 393. Kent, state of its agriculture adduced in reference to the influence of manufac¬ tures, i. 168. Kent, (Mr.,) quoted against large farms, i. 125, seq.; adduced as to the quan¬ tity of land necessary for the support of a horse, 250. Kidders, who are they ? ii. 56. King, (Mr. Edward,) adduced as to the Utility of the National Debt, ii. 218. King, (Mr. Gregory,) as a statistical inquirer, i. 215-217 ; his estimate of the numbers of the population in the several ranks, professions, and occu¬ pations, 240 ; as to the relative pro¬ portion of wheat consumed about the era of the Revolution, 368 ; referred to in regard to the Corn Laws, ii. 84 ; in regard to the proportion between the price and produce of corn, 134, seq., 138. Kingdom, see Monarchy. Labour : of slaves, i. 37 ; Productive and Unproductive, on, in general, 253- 332 ; the relative doctrines of the Econo¬ mists of the school of Quesnai con¬ trasted with those of Smith, 255, seq., 269, seq. ; labour and land, these as sources of wealth contrasted, 256, seq. ; labour pi’oductive and unproduc¬ tive, with special reference to the Economists, 258, seq., 268, seq., 294, 297 ; apology for their use of these terms, 290 ; human, can be employed to increase the fund of natural produce only in two ways, — by adding to the quantity, or by altering the form of this produce ; the first, by Agricul¬ ture — the second, by Manufactures, 259, seq. ; distinction of useful and of productive, 264, seq. ; of productive and of stipendiary, 265 ; labour pro- INDEX. 477 ductive, Smith’s doctrine of, ib. ; ad¬ ditional illustrations of this distinc¬ tion, 270, seq. ; Smith at one with the Economists with respect to the fact, 270 ; how far he agrees with, how far he differs from, them as to doctrine, 271 ; barren or unproductive and pro¬ ductive, distinction of, according to Smith, 274, seq., 285, seq. ; according to the Economists, 274; according to Grey, 275 ; according to the Au¬ thor, 275, seq. ; on the circumstances which render it more effective, 309- 332 ; on the division of, 310-316; on the use of machinery as a substitute for, 316-332 ; division of, its moral effects, 330, seq.; result of the rea¬ sonings on its division, 331 ; correc¬ tion of certain expressions in relation to, 332 ; does the amount of labour constitute the real measure of the exchangeable value of commodities, as held by Smith ? 353, seq. ; wages of, the five circumstances, according to Smith’s doctrine, on which they vary, ii. 11; a circumstance causing great inequalities in the wages of agricultural labourers, both in Eng¬ land and Scotland, viz., the prejudices and ignorance of this order of men, 268. > See Wages. Labour and Stock, three circumstances, according to Smith, which ought principally to be attended to in deter¬ minin'.; their distribution, ii. 12, seq. ; the first of these, ib. ; the second, 20, seq. ; the third, 21. Lagrange, on the proportion between consumption and population, i. 219, seq. Land, free commerce of, naturally con¬ ducive to Agriculture and Population, i. 151 ; Land and Labour, as sources of wealth, contrasted, 256, seq.; land¬ ed property, peculiar circumstances regulating its price, 423, seq. ; com¬ merce of, on the policy of subjecting this to the regulation of law, 195-210 ; free commerce in, expedient, 202 ; impediments to, 202, seq. ; in certain circumstances, restraints may be ex¬ pedient, 203 ; taxes upon, 225-247 ; land-tax proportioned to the rent , of two kinds: 1°- according to a fixed rule or canon, 225-234 ; Land-tax of England, (falling under this head,) origin and history of, 225 232 ; the English land-tax affects all personal estates, except property in the funds, and stock necessary for agriculture, 228 ; method of rating this tax, ib. ; policy of this tax considered, 228-232 ; defects of the English land-tax, 229, seq. ; advantages of the same tax, 231, 232 ; land-tax of Scotland, 232- 234; — 2°- according to the actual rent, 234-243 ; Venetian tax, of this class, 234; advantages and disadvan¬ tages of this kind of land-tax, 235, seq. ; exclusive land or territorial tax, approved of by the Economists in ge¬ neral, and in particular by Quesnai, by Mirabeau the elder, by Dupont, by Turgot, 237, [see also, i. 296, seq. ;) in opposition to this project are arrayed Necker, Pinto, Hume, Sir James Steuart, Smith, and Arthur Young, ib., ( see also, i. 301 ;) land-tax pro¬ portioned not to the rent, but to the produce, 243-247 ; church-tithes, an example of this, 243 ; other instances in China, Bengal, and ancient Egypt, 246 ; all land-taxes fall ultimately upon the landlord, 243 ; taxes on the pro¬ duce of land may be drawn either in land or in money, 247. See Terri¬ torial Tax. Languages, the analogy of, explains what is politically constitutional or unconstitutional, ii. 423, 424. Lauderdale, (Earl of,) adduced, i. 299, 301 ; as to the division of labour, 315 ; Notes on the Bidlion Report, ad¬ dressed to, 431, seq. ; his pamphlet on the Irish Bank quoted, 434, 442 ; his doctrine of Paper Currency criti¬ cised, 452 ; adduced, ii. 217 ; his work on Political Economy recommended for study, 459. Laverdi, (M. de,) referred to as emanci¬ pating the French corn trade, ii. 63. Lavoisier, on the proportion between consumption and population, i. 219, seq. ; adopted the fundamental prin¬ ciples of the Economists, 289. Law, (Mr. John, of Lauriston,) his opi¬ nion as to the intrinsic value of gold and silver, i. 341, seq. ; Locke de¬ fended against, ib. ; seems to renounce the doctrine for which he had con¬ tended, 344; his doctrine of value, 355 ; touching the rate of interest, 398 ; vindicates a complete liberty in regard to the interest of money, ii. 157, 158 ; was he the first to do this? 159. Laws, — l0, as to their origin, 2°- as to their tendency, i 22 ; positive laws, 478 INDEX. two classes of, taken by Gognet, 57, 58. 'Leases of farms, history of, i. 114-118 ; progress of, in England, 115, 116; in Scotland, 116, 117; registers of, a project of the Author for taxation, ii. 235, 239, 241. Legislative Power, ii. 351, 352 ; advan¬ tages of its division in the British Constitution, 428-430 ; a secondary advantage from this division, in that it establishes a sort of balance in the Constitution, 430, 431; division of the legislature vindicated against foreign political writers, 460, seq. Leibnitz, alleged as calling the theory of money a semi-mathematical specu¬ lation, i. 14. Letrosne, see Trosne. Lewis, (John,) extract from his History of the Translations of the Bible, shewing the prevalence of Beggary even under the Papacy, ii. 260, seq. Liancourt, (M. de la Rochefoucauld,) his Report on Beggary adduced, i. 199; his recommendation of potatoes as a cheap and nutritious diet, ii. 143. Liberty. (Political,) contrasted with Happiness, i. 23. Libraries, effects of, in the cultivation of the people, ii. 346, seq. Life, expectation of, by what principles regulated, i. 225, seq. ; what circum¬ stances to be attended to in its esti¬ mation in reference to town and country, sex, &c., 230, seq. Liquors, (intoxicating,) their cheapness encourages inebriety, ii. 317. Liverpool, (Earl of,) referred to in his Treatise on the Coins of this Realm, i. 334 ; quoted as to gold being now and here the measure of value, 347, seq. ; Author’s doubts as to this opi¬ nion, 348. Livy, quoted as to the legislative power in the Roman republic, ii. 435. Locke, his notions as to political liberty, i. 23 ; as to land and labour, in so far as they are the sources of national wealth, 256 ; quoted from his Consi¬ derations on the Lowering of Interest, •See., in regard to an exclusive terri¬ torial tax, ii. 238, 298, seq. ; his opi¬ nion as to the imaginary value be¬ stowed on the precious metals, fitting them for the purposes of exchange, 341 ; his doctrine on this point de¬ fended against Law, 341, seq- ; as to the precious metals constituting the measure of value, 347 ; coincides with our Author as to Corn constituting the best measure of value, 362, seq. ; coincidence of his opinion with that of Montesquieu in regard to the value of the precious metals, 373, see also 362, seq., and 389 ; his doctrine touching the rate of interest, 398 ; on his theory touching the circum¬ stances determining the price of land, 424 ; strictures upon this doc¬ trine, ib. ; his opinion on interest and usury, ii. 159 ; anti-usurious laws, how far nugatory? 189, 190, seq.; a Repiort of his in 1697, adduced in re¬ gard to the relief of the poor, 270; influence of his Treatise on Educa¬ tion, 343. Lolme, see De Lolme. London, proportion of Births to Burials in, i. 228, seq.; what is necessary to be here attended to in our statistical estimates, 229 ; population of, 244, seq. Lucretius, quoted as to the priority of concubinage to marriage, i. 70. Lycurgus, his political perspicacity praised, ii. 414, 416. M'Culloch, (Mr. J. R.,) his Literature of Political Economy referred to by the Editor, i. 333. Machiavel, quoted as to the history of all republics, ii. 372. Machinery, as a substitute for human labour, on its advantages and disad¬ vantages, i. 188-198, 316-332 ; in particular, its advantages, 193, seq. Mackie, (Mr. William,) on the compa¬ rative nutritious power of fertile land in raising animal or vegetable food, i. 109-111, 249; as to the average quantity of land necessary for the support of a horse, 250 ; adduced as to the policy of bounties on the expor¬ tation of corn, ii. 114, 115. Macpherson, (David,) against the ba¬ lance of trade, ii. 23, seq., 28, seq. Males, their lives more brittle than those of females, i. 90. Malthus, (Rev. Mr ,) adduced as to the progress of Population, i. 62 ; as to the ratio of its progress, 64 ; as to the evil effects of an injudicious legal provi¬ sion for the poor, 202 ; his Essay on the Principle of Population, adduced and praised, 203 ; recommended for study in the conclusion of the Course INDEX. 471) of Political Economy, ii. 458 ; on productive and unproductive labour, 283 ; adduced in relation to the Eco¬ nomists against Smith, 290 ; in re¬ gard to the policy of a bounty on the exportation of corn, ii. 114; quoted on the Corn Trade, 118-120 ; ad¬ duced as to the price of corn, 137 ; thinks it expedient to trust the relief of the poor to voluntary charity, 276 ; against a compulsory assessment for this purpose, 278, seq. ; proposes a gradual abolition of the English Poor-Laws, 280, 281 ; on Savings Banks, 313 ; adduced, 333. Man, by nature social, on this Aristotle and the Pseudo-Pythagoreans, i. 18 ; his rudest state not the most natural, 73, 86. Mandeville, (Dr. Bernard,) referred to in general on the effects of the divi¬ sion of labour, i. 311 ; quoted parti¬ cularly on the same subject, 323. Mantuanus, (Baptista Spagnoli,) on the dependence of civilisation (or the arts) on labour, i. 309. Manufactures, influence of, on Popula¬ tion and Agriculture, i. 152-183 ; may be injudiciously encouraged, 159, seq. ; Manufactures and Agri¬ culture, on their relative claims to the attention of the statesman, 201, seq.; progress of, during the eighteenth century, 237, 238 ; dependence of, upon Agriculture, 260. Margites, (the Pseudo-Homeric,) quoted as to the Division of Labour, i. 311. Marino, Republic of, noticed, ii. 357. Marriage, compared with Concubinage in reference to Population, 67-82 ; is it of natural or municipal law? 69, seq.; is of natural law, 79 ; marriages will take place where and when they ought, 199 ; proportion of Marriages to Births and Deaths, 220, seq. Marsden, quoted in regard to the pro¬ portion of the sexes born in Sumatra, i. 91. Marshall, (Mr. William,) referred to in regard to the artificial fattening of cattle, i. Ill; quoted on the good qualities of the Kentish yeomanry resulting from Gavelkind, ii. 199, 200 ; adduced in regard to intem¬ perance in the use of malt liquors, 318. Martial, referred to touching the facility of divorce in Imperial Rome, i. 82. Maryland, the various useful expedients in this State to choose fitting sena¬ tors, ii. 433. Maseres, (Mr. Baron,) adduced as t<> tithes, ii. 245. Menu, in India sanctioned usury at a date of indefinite antiquity, ii. 152, seq., 187. Merchants, Mercantile or Commercial Interest, nature and effects of, i. 404, seq. Metals, precious, see Gold, Silver, &c. Metayer , what kind of tenant in France ? i. 113, seq. Metrologie a work of M. Paucton, i. 217-219,' &c. Meunier, (M.,) adduced in regard to the difficulty of a valuation, ii. 242. Middleton, (Mr.,) quoted against tithes, i. 123, seq. ; referred to on the popu¬ lation of England and Wales, 243 ; on that of London, 244, 245. Middleton, (Rev. Conyers,) quoted as to the connexion of knowledge and happiness, ii. 349. Milk, as an economical article of food, recommended, ii. 142. Millar, (Prof. John,) of the varying in¬ fluences of the Crown upon the House of Commons, ii. 450. Mirabeau, (Marquis de, the father,) ad¬ duced as to population, i. 65, 209, 430; in favour of large farms, 127 ; quoted in this respect, 129 ; adduced as to productive and unproductive labourers and their subdivisions, 274 ; his writings praised, 289 ; referred to in favour of a territorial tax, 301, ii. 237 ; his Ami des Hommes recom¬ mended in the conclusion of the Course on Political Economy, ii. 458. Mirabeau, (Marquis de, the son,) quoted as to the influence of Manufactures in a political relation, i. 176, seq. Moderation, the principle of aristocracy, what does it mean in the language of Montesquieu? ii. 379-382. Modesty, in woman not factitious, i. 75. Moheau, (M., author of Becherches , &c.,) adduced as to the effect of cli¬ mate on Population, i. 61 ; as to the proportion of the Sexes born in France, 88 ; on the average number of inhabitants to a bouse in France, 217 ; as to the rate of the consump¬ tion of bread in France, 218; as to the proportion between consump¬ tion and population, 219; as to that between births and inhabitants in France, 222, see 223 ; his work on 480 INDEX. Population commemorated in the con¬ clusion of the Course on Political Economy, ii. 458. Monarchy, on, simply and in general, ii. 353 ; on, in special, 386-401 ; its corruption Tyranny, or Despotism, 384 ; Absolute, the only form of go¬ vernment for which there is a word in the Persian language, 389 ; in some absolute monarchies the prince is viewed as proprietor of all lands, and as heir to all his subjects, 391 ; how tempered by a hereditary nobi¬ lity, 407 ; or by different ranks, lb. See Despotism. Money, as the circulating medium, i. 333-425 ; on the origin and use of, 333-349 ; circumstances which re¬ commend gold and silver as the fittest materials for coin, 334, seq. ; relation of bullion or coined metals to a paper currency, 346, seq.; prices, real and nominal, 349-371 ; on what principle shall the value of money, at different times, be estimated? 352, seq. ; does the amount of labour afford the real measure of the exchangeable value of commodities, as held by Smith ? 353 ; this doctrine combated, 353, seq. ; as to the effect of a slow and rapid cir¬ culation of, 379, seq. ; as the standard of value, 390-396 ; interest of, 396- 425 ; value of, employed in two dif¬ ferent senses, 408, seq. ; Commerce of, should it be regulated by law ? on, in general, ii. 146-195. /See Capital, Usury. Monied Interest, what ? i. 405, seq. Monogamy, compared with Polygamy in reference to Population, i. 82-92 ; favoured by the near proportion of the sexes, 90. Monopoly, patents of, by Queen Eliza¬ beth, ii. 17 ; in general withdrawn by James I., but some granted, 17-19, seq. ; case of the London Company for the Manufacture of Flour , Meal , and Bread , 96-100. Montesquieu, adduced in regard to the advantages of political wealth, i. 35 ; quoted as to the introduction of bills of exchange by the Jews, 41 ; as to the exceptional Polygamy of the ancient Germans, 84 ; wrong in his reliance on the authority of Kaempfer that more females than males are born at Bantam, 90, 91 ; quoted on the effect of employing machinery as a substitute for manual labour, 189 ; his opinion controverted, 190 ; his speculation in regard to the value of the precious metals in different ages and countries, 372, 376, seq. ; his doctrine touching the rate of interest, 398, 432, 445 ; alleged touching the exaction of interest by the Jews, ii. 150 ; adduced as to the Roman laws of succession, 197 ; holds that it would be better to trust the relief of the poor to voluntary charity, 275 ; on the division and distribution of political powers, 352 ; his discrimination of the simple forms of government, in general, 352-354 ; on the mode of voting in republics, 358, 359 ; on the distribution of property in republics, 359, 360; how he explains that the Roman people had no disputes about the executive authority, 369 ; how he explains the result of a sudden and exorbitant authority conferred upon a citizen in a democracy, 369, 370; as to the inconveniences of democra¬ cies and aristocracies, and how these maybe remedied, 373, 374; quoted as to the nobility in an aristocratical government, 377 ; what aristocracies are the best, 378 ; what does Modera¬ tion mean as the principle of aristo¬ cracy, 379-381 ; that the nobles should, in an aristocracy be prohibited from every kind of commerce, 383 ; in fact, all vain distinctions of birth (even pri¬ mogeniture) should be there abolished, 383, 384; shows the necessity for a Vizier in an Absolute Monarchy, 390; quoted as to the savages of Louisiana cutting down a tree for the sake of its fruit, affording an emblem of despotic government, 393 ; on Fear, his prin¬ ciple of Despotism, 394, seq. ; ad¬ duced as to the impossibility of any stable order of succession in a despot¬ ism, 397 ; what he supposes a mon¬ archical government to comprise, 407 ; what he means by Honour as the principle of Monarchy, 408 ; by Vir¬ tue, as the principle of Democracy, ib. ; how he distinguishes Monarchy from Despotism, 408, 409 ; indirectly lauds the constitutional limitations of the English Government, 409; quoted in regard to Monarchy, 410, 411 ; an apology for his inaccuracies, 410, 412 ; on the division of the English Legis¬ lature, 440. Morals, are these improved by the in¬ tellectual cultivation of a people? ii. 345, seq. INDEX. 481 More, (Professor,) obligations of the editor to, i. xxii. More, (Sir Thomas,) testimony shew¬ ing that the Reformation was not a cause of vagrancy, ii. 261. Morellet, (Abbe,) praised, i. 289, et alibi; employed to refute Galiani, ii. 66. Morgan, (Mr. William,) on the average population of London, i. 217; as to the annual proportion of births to in¬ habitants in a country, 222. Moses, quoted as to manual labour pre¬ vious to the employment of corn-mills, i. 191 ; as to Usury or Interest, ii. 149 ; his measure for preventing in¬ equality in the appropriation of land adduced, 196. Muret, (M.,) referred to as to the propor¬ tion of, Sexes born in the Pays de Yaud, i. 88, 89 ; quoted against large farms, 126. Mushet, (Mr. Robert,) his misapplica¬ tion of the word commodity to bank- . notes, i. 436, 437. Naples, proportion of births to inhabi¬ tants in that kingdom, i. 222. National Revenue, what its meaning ac¬ cording to the Economists, and to Adam Smith, i. 293. National Resources, equivalent to the Population and to the Wealth of a country, i. 59. National Wealth, see Wealth, National. Natural Law, vagueness of the phrase, ii. 207, 208. Nature : a state of nature not identical with man’s rudest state, i. 73, 86. Navigation Act, on the policy of, ii. 24, seq. ; 40, seq. Necker, (M.,) on the proportion of population to the consumption of wheat and salt, i. 219 ; adduced as to the proportion of births to inhabitants in France, 222 ; as against the pro¬ ject of an exclusive territorial-tax, 301 ; ii. 237 ; as fettering the corn trade in France, ii. 65, 66 ; his pre¬ cautions, when in power, against a scarcity of grain, 71 ; effect of, the very opposite of what was intended, 72 ; of this Necker himself was ulti¬ mately convinced, 73 ; adduced, 79; his treatise On the Legislation and Commerce of Crain , quoted, 82, 83 ; quoted as to the Corn laws, 84; apo¬ logy for, by the author, and others, 86, VOL. IX. 87 ; quoted as to Usury, 151 ; adduced in favour of taxes on consumption, 252. Nepos, (Cornelius,) quoted on Roman expenditure, i. 382. Nett produce, what, in the language of the Economists, i. 295-297. Nobility, as the body out of which a privileged aristocracy is formed, may be widely diversified, ii. 376, seq. ; a hereditary nobility, how it tempers the rigour of monarchy, 407. Nobleman and Gentilhomme , how they differ in signification, 405. Notes, Interpolations from, see Bridges. (Economists, see Economists. (Economy, see Economy. Ogilvie, (Prof.,) quoted against the impo¬ litic burdens upon Agriculture, i. 121. Oligarchy, the corruption of Aristocracy, in the language of the ancient politi¬ cians how defined, ii. 384. Osterwald, (M.,) adduced, ii. 13, seq. Oswald, (Mr., of Dunnikeir,) as suggest¬ ing a doctrine to Adam Smith, ii. 6. Ottoman Empire, no progressive im¬ provement in, ii. 391. Owen, (Mr. Robert,) referred to in re¬ gard to the employment of children in manufactures, i. 185. Paley, (Archdeacon,) quoted against pasturage, i. 106, see 112; against tithes, 122, seq. ; on the advantages of a division of the legislative autho¬ rity in England, ii. 429, 430. Park, (Mungo,) quoted as to the Poly¬ gamy of the central Africans, i. 86 ; adduced for the employment of cowries as a circulating medium, 339 ; letter of, to the Author, quoted, 340. Parliament, see Legislative Power, Com¬ mons, Peers. Paucton, (Monsieur, author of Metro- logie,) quoted as to the proportion of the Sexes born in Germany, i. 87 ; adduced touching the consumption of food as indicating by its amount the population of a town, 217, 219 ; of the total population of the world, and of its several quarters, 232 ; on the superficial extents of the several quarters of the globe, ib. ; alleged as to Usury and Interest in ancient Rome, ii. 152. Pawnbroking, indiscriminately con¬ demned by the opinion of the English 2 II 482 INDEX. House of Commons, ii. 154 ; a species of usury allowed bylaw, 182, seq. Peers, in ancient times formed not only the nominal, but the real aristocracy of the State, ii. 447 ; now frequently of obscure origin and limited fortune, 448 ; House of, how its authority is modified in modern times, 448, 449. Pennsylvania, State of, ultimately re¬ sorted to a division of the legislative power, ii. 432. Periodical publications, influence of, in the enlightenment of the people, ii. 343. Persian Language, has no word for any form of government but Absolute Monarchy , ii. 389. Personal Taille, a tax upon the profits of stock employed in agriculture, ii. 250, 251. Petty, (Sir William,) as to the popula¬ tion of Ireland, i. 99 ; the oldest sta¬ tistical author, 212, seq. ; his Poli¬ tical Arithmetic described, ib. ; his claim as founder of this branch of Political Science, considered, 214; re¬ ferred to on the division of labour and its effects, 311 ; as to the precious metals constituting the measure of value, 347 ; as anticipating Adam Smith, ii. 6. Philips, (Erasmus,) quoted for the free¬ dom of commerce, ii. 35. Philosophy, not responsible for the false political theories in vogue, i. 19. Phocion, referred to for his opinion in regard to the disadvantages of wealth, i. 34. Physical knowledge, uninteresting when compared with the studies connected with the improvement and happiness of society, ii. 398. Pinkerton, (Mr. John,) quoted as to Scottish manufactures, interest of money, &c., i. 402. Pin-making, this manufacture taken in illustration of the division of labour, i. 256, seq. Pinto, (Isaac,) adduced as to the oppos¬ ing systems of Political Economy, i. 46 ; as to the principle of Population, 203 ; the relative passage from his Treatise on Circulation and Credit, quoted, 429-431 ; as against the project of an exclusive territorial tax, 301 ; ii. 237 ; adduced in regard to the vary¬ ing value of the precious metals, 375 ; quoted as to the effect of a rapid cir¬ culation on money, 378, 438, 439 ; adduced as to the public debt of Great Britain, ii. 218. Pitt, (Mr. Morton,) alleged in reference to the effect of charity-workhouses,' ii. 301, 302. Pitt, (Right Honourable William,) ad¬ duced in regard to the payments of the Bank of England, ii. 1 08 ; his Poor Bill, 285. Plato, referred to as a political theorist, i. 32 ; his theory of a proposed com¬ munity of wives and children, &c., adduced, 55, 68 ; as recommending a conjugal union, 78, 79 ; his opinion as to interest and trade in general, ii. 151, seq. Pliny, (the elder,) quoted as to the esti¬ mation of agriculture by the early Romans, i. 140, 144. Pliny, (the younger,) referred to in re¬ gard to the legal discouragements of celibacy among the Romans, i. 94 ; quoted as to the true policy in regard to celibacy, 96. Plowden, (Mr., of the Middle Temple,) on the morality of Usury or Interest, ii. 150. Plutarch, referred to in regard to the disadvantages of wealth, i. 34. Political Economy, an outline of its contents, i. 3-6 ; of its objects and province, in general, 9-58 ; meaning of the title as used by the Author in an unexclusive sense, to wit, as contain¬ ing two parts, 1°- Political Economy Proper, 2°- Politics Proper, 9, seq., 16; meaning of the phrase in its accepta¬ tion proper or limited, 9, seq. ; inti¬ mate connexion of, with the philoso¬ phy of the human mind, 17, seq. ; the Author does not exclude Politics from Political Economy, 21 ; proposed order in the distribution of the Lec¬ tures on, 21, 29; Political Economy proper as opposed to Politics, its con¬ tents and distribution, 30-56 ; contains, 1°- Population, 31, seq. ; 2°National Wealth, 33, seq. ; 3°- the Poor, their maintenance, 47, seq.; 4°- Education and the repression of crime, 49, seq. ; merits of the Scottish Legislature re¬ garding Political Economy Proper, ii. 331, 332 ; Politics Proper, opposed to Political Economy strictly so called, in other words, the Theory of Govern¬ ment, 350-452 ; conclusion of the course on Political Economy Proper, with an enumeration of certain emin¬ ent authors connected with, 458, 459. INDEX. 483 Political Institutions, must be accommo¬ dated to the circumstances of a people, ii. 419-421. Political science, has two branches; — the Theory of Government (Politics Pro¬ per), and Political Economy (Proper), i. 24, 25, 29 ; study of Politics or Political Philosophy conduces to pub¬ lic spirit, and is otherwise of advan¬ tage, 20 ; ii. 399, 400. Politicians, Ancient, ignorant of mixed monarchies, ii. 386. Polybius, referred to as to the price of wheat in antiquity, i. 381 ; that the government of Rome resembled an aristocracy, ii. 368 ; quoted as to the three simple forms of government, 413, 415 ; that the government of Rome resembled all the three forms, 414 ; in this respect defended against Grotius, 415. Polygamy compared with Monogamy, in reference to Population, i. 82-92 ; of two kinds — a plurality of Wives, or a plurality of Husbands, 82 ; the latter is passed over as a rare anomaly, 84. Poor, the, their maintenance, a branch of Political Economy Proper, i. 47, seq. ; how their legal maintenance may be detrimental, 202 ; great in¬ crease of, in consequence of the sup¬ pression of villanage, 210, 211; great number of beggars in Scotland to¬ wards the close of the seventeenth century, 210 ; also in England during the sixteenth century, ib.; circum¬ stances affecting the comfort of the labouring poor, 251 ; on, in general, ii. 254-326 ; relief of, an important subject of Political Economy, 255 ; the transmutation throughout Europe of slavery into villanage, and of vil¬ lanage into freedom, how it compli¬ cates the claims of the poor to relief, 256, seq. ; emancipation of the lower orders in England, 257 ; effect ot the Reformation in multiplying English paupers, 259 ; amount of funds ex¬ pended on the support of, in England, 273, 274 ; how their relief accom¬ plished through Benefit Clubs or Friendly Societies, 274, seq.; have they a right to maintenance ? 275 ; is it expedient to abandon their relief to voluntary charity ? 275, seq. ; plan of a limited assessment for the sup¬ port of, 278 ; against such plan of a limited relief, 278, seq. ; subsidiary measures for their relief, 300-326 ; Charity Workhouses, 300-305 ; Bene¬ fit Clubs, 306-313 ; on their distresses as connected writh their evil habits, 313-326 ; habits of economy, good effects of, 321. See Poor-Laws. “ Poor, Society for bettering the condi¬ tion of,” its Reports quoted, ii. 307 309 ; referred to, 322, 323. Poor-Laws, British, Historical Sketch of, ii. 254-299; English, 254-286; Parliamentary measures against sturdy begging, 257, 258 ; for the re¬ lief of the aged and impotent, 258,; Act for the relief of the poor, passed in 1601, the 43d of Elizabeth, con¬ stituting the foundation of our present poor laws, 261, seq.; Law of Settle¬ ment enacted 1662, and its effect, 265 ; its ambiguity, 265, 266 ; the Scottish political economists de¬ fended, or excused, on this point by the Author against their English critics, 267, 268 ; spirit of the English Poor Laws praised, 281, 282; Scot¬ tish, sketch of, 286-299 ; contrasted with the English, in that the assess¬ ments are not compulsory, 287 ; ear¬ liest Scottish statutes for support of the poor, 287, seq. Population, a branch of Political Eco¬ nomy Proper, i. 31, seq.; on, in gen¬ eral, forming Book I. of Political Economy Proper, 59-252 ; considered as an article of Natural History, 60- 66 ; effect of climate on, 61 ; progress of, in America, 61, seq. ; in Flanders, London, Iiindostan, &c., 62, 63 ; con¬ sidered as an article of Political Eco¬ nomy, 67-252 ; as affected by the Political institutions which regulate the connexion between the Sexes, on, in general, 67-92 ; Marriage and Concubinage, 67-82 ; by Monogamy and Polygamy, 82-92 ; by the state of manners relative to the connexion between the Sexes, 92-97 ; in relation to celibacy and its counter regulations in the states of antiquity, particularly the Roman, 92-94 ; in relation to celibacy in modern states, 95, seq. ; dependence of, on the means of sub¬ sistence enjoyed by the people, 98- 211; as dependent on the Notion held in regard to the competent sup¬ port of a family, 98-112 ; in this rela¬ tion comparative view of population in England and in Ireland, 99, seq. ; as checked by poverty, 102, seq.; in 484 INDEX. connexion with Agriculture, 113-152 ; in connexion with Manufactures, 152- 183 ; is the density of, in proportion to the extent of country, a certain index of national prosperity? 198- 211 ; Author resolves this question in the negative, 198, seq. ; instances of a mistaken policy of different coun¬ tries in this respect, 199, seq. ; on the principle of, quoted various authors, 203, seq. ; the Author holds less gloomy views on this subject than Mr. Malthus, and why, 207, seq. ; on the means which have been employed to ascertain the state of population in particular instances, — in general, 211- 252 ; this sought to be estimated from the number of houses — from the quantity of food consumed — and from the amount of births, deaths, and marriages, 212, seq.; statistical au¬ thors who have attempted such an estimate, adduced, ib. ; as estimated by the proportion of births, deaths, and marriages, 220, seq. ; comparative value in this estimation of the Bills of Mortality and Begisters of Births, 223, 224, seq.; how the population of a country is to be inferred, 225, seq. ; considerations to be attended to in our calculations concerning, 227, seq.; population in England and Wales, 242, seq. Porteous, (Bishop,) quoted as to Educa¬ tion, i. 50, 51. Postlethwayt, (Malachi,) his Dictionary adduced, i. 145 ; quoted as to the effect of machinery in reference to labour, 195 ; as to Sir William Petty’s Political Arithmetic, 215; as to rate of interest in China, 421. Potato, its nutritive qualities, i. 100, 101, 105; ii. 142, 143. Poverty, though favourable to the pro¬ duction of population, unfavourable to its maintenance, i. 102, 103. Powers, Legislative, Judicial, and Exe¬ cutive, ii. 351, 352. Press, see Printing. Price, (Rev. Dr. Richard,) as to the proportion of the Sexes born in Eng¬ land, &c., i. 88-90 ; as to the amount of population in England and Wales, 99, 242 ; quoted against large farms, • 126; against Enclosures, 132, 134; on the character of Dr. Davenant as a political arithmetician, 215; as to the average population of the houses in London, 217 ; on what principles the population of a country is to be estimated, 225 ; his authority as a Political Arithmetician of high ac¬ count, 227 ; on the greater mortality of towns compared vrith that of rural districts, 231 ; on the actual popula¬ tion of Great Britain, and its decline before and after 1769, 233 ; this de¬ cline controverted, but the opinion excused, 237 ; on the progress and decline of Agriculture in Great Britain, 238 ; on the population of London, 244 ; as to the right and the wrong between him and his opponents, 250, 251 ; alleged touching the poor, ii. 309. Prices: Real and Nominal, i. 349-371 ; difference between the relative doc¬ trines of Smith and of our Author, 349, seq. ; doctrine of Smith, 350, seq ., 357, 358 ; price and exchange¬ able value, the doctrine of our Author on, 360, 361 ; standard of, on our Author’s doctrine, 361 ; how affected by the plenty or scarcity of the pre¬ cious metals, 371-390; the cost of a commodity, according to Smith, is naturally made up of one or all of these three parts — the price of labour , the rent of land, and the profits of stock and ivages, 391, seq.; ii. 5; other circumstances which determine dif¬ ferent prices, referred to three heads, 391, 392 ; market prices, principles which determine their variation, ac¬ cording to Smith, 392, seq.; ii. 6, seq. ; according to Sir James Steuart, 393 ; according to the Author, 393, 395 ; according to Mr. Boyd, 394 ; according to Sir Francis Baring, 394, 395 ; natural, as distinguished from the market, price, ii. 6, seq. ; circum¬ stances which determine the price of commodities, 8, seq. Primogeniture, effects of, referred to, i. 152 ; right of, in succession to land, ii. 197, 198, 201 ; an obstacle to agriculture, 201. Printing, effect of, on political improve¬ ment, i. 27, 28, 44; ii. 398. Productive, to what kind of labour most appropriately applied, i. 260; is this epithet applicable to manufactured produce ? ib. Profit, Taxes upon, ii. 249-251 ; these, on profit in general, 249 ; on the profit of particular employments, 250, 251. Properties, (Estates,) size of, i. 138-152 ; in France, 148, seq.; Agrarian Laws INDEX. 485 of the Romans In reference to, 138, seq.; effect of these laws upon Agri¬ culture, 139, seq. Proportions : — between the Sexes — be¬ tween Births and Deaths — between Marriages and Population, i. 221, seq. Proverbs on the division of labour, quot¬ ed from different languages, i. 310, 311. Provisions, see Food. Pulteney, (Sir William,) in favour of the project of a limited assessment for the Poor, ii. 278. Purveyance, as a farm burden, i. 118, seq. Pythagorean ; Pseudo-Pythagorean opi¬ nions referred to as genuine, i. 18. Quesnai, (M.,) adduced as to the mean¬ ing of the term Political Economy, i. 8, 9 ; his Economical System estimated, 163 ; his views and those of the Eco¬ nomists in regard to population, 208, seq. ; praised, 289 ; alleged as to cur¬ rency, 434 ; in favour of an exclusive land-tax, ii. 237. See Economists. Ranks, established, how they temper the rigour of monarchy, ii. 407. Raynal, (Abbe,) quoted as to the advan¬ tages of wealth, i. 35; referred to as to the mutual influence of Manufac¬ tures and Agriculture, 168 ; adduced as to the kingdom of Siam, ii. 392. References, marks of, explained, i. xxiii. Regrators, laws against, i. 121 ; who ? ii. 55. Reid, (Dr.,) vindicated Usury before Bentham, ii. 157 ; quoted to this effect, 185. Rennel, (Major,) quoted as to the use of cowries as coin, i. 339. Republic or Commonwealth, its corrup¬ tion Democracy, or more precisely, Ochlocracy, ii. 384. Respondentia, a species of virtual usury, ii. 186. Restraints on the commercial intercourse of nations, ii. 22-47. Retz, (Cardinal de,) quoted in reference to a Republic, ii. 362. Ricardo, (Mr.,) quoted, i. 444, 445. Ricaut, (M.,) quoted as to the Ottoman empire, ii. 391, 392. Bice, in relation to the quantity of food it yields, i. 104 ; rice countries those alone in which the effects of a scarcity of grain is to be apprehended, ii. 52. Richelieu, (Cardinal,) bis Political Testa¬ ment referred to by Montesquieu, ii. 410, 411. Riviere, (M. Mercier de la,) an Econo¬ mist, adduced, as praised by Smith, i. 308 ; his work, On the Natural and Essential Order of Political Societies , recommended for study in the conclu¬ sion of the Course on Political Eco¬ nomy, ii. 459. Robertson, (Mr., of Granton,) as to Scot¬ tish Statistics, i. 246. Robertson, (Principal,) adduced as to the difference of ancient and modem trade, i. 38, seq. ; referred to as to the rise of towns after the fall of the Ro¬ man Empire, ii. 16 ; adduced as to the origin of standing armies in modem Europe, 421. Robertson, (Rev. Dr. James,) adduced in regard to the size of farms, i. 128 ; in favour of large farms, 130 ; as to the garden system of Roman Agri¬ culture, 140 ; quoted as to the impor¬ tation and exportation of corn, 247. Roederer, (Herr,) noticed as a collector of observations touching the proportion between consumption and population, i. 220. Romans, policy of, in regard to Agricul¬ ture, i. 138-140, 143, 144 ; instances of the great wealth of individuals in the Roman State, 147 ; Roman luxury, ib. ; anomalies of prices explained, 448 ; their laws of succession in land, ii. 197 ; Roman Republic, on its legis¬ lative power, 435. Rose, (Right Honourable George,) ad¬ duced touching taxes, ii. 217. Rousseau, on the connexion of wants, labour, and intellectual development, i. 309 ; quoted against the freedom of the English people, ii. 437. Rudeness : Man’s rudest state is not bis most natural, i. 73, 86. Rumford, (Benjamin Thomson, Count,) his experiments on nutrition referred to, i. 112 ; ii. 145; referred to as to the management of the poor in Mu¬ nich, ii. 305. Sat/lust, on Contempt, as the aristocra¬ tic feeling of the Roman nobility, ii. 382. Savings’ Banks, (but not so called,) their institution recommended, ii. 313. 486 INDEX. Soaliger, (Joseph,) his Epigram on the Marvels of Holland, i. 284. Scotland, progressive population of, i. 245, seq. ; state of wealth and manu¬ factures in, in the more ancient times, 402 ; rate of interest in, explained, 403 ; rate of interest in, at different times, 415 ; laws against engrossers and forestalled, ii. 56 ; parochial schools of, their history, 328-333. See Poor-Laws. Seneca, the philosopher, referred to for his opinion in regard to the disad¬ vantages of wealth, i. 34 ; quoted as to the facility of Divorce, 82. Sens, (Archbishop of,) his policy in re¬ gard to the corn trade, ii. 73, 80. Services, a burden due by farm tenants, i. 118, seq. Servility, owes its origin to principles in human nature of great value, though capable of abuse, ii. 394. Settlement, Law of, see Poor-Laws. Sexes, proportion of, at birth, i. 87-92, 221. Shalcspeare, on the morality of Usury, ii. 147. Sheffield, (Lord,) a pamphlet of his ad¬ duced in regard to the importation of corn, ii. 108 ; as to the amount ex¬ pended on the relief of the poor in England, 274. Shuckburgh, (Sir George,) his Table of Prices referred to, ii. 138. Siam, misery of that kingdom, ii. 392. Sidney, (Algernon,) on Democracy, ii. 356, 357. Silesia, see Breslau. Simpson, (Thomas,) his Tables of Mor¬ tality referred to, i. 227. Sinclair, (Sir John,) adduced as to Sta¬ tistics, i. 214; as to the statistics of Scotland, 246 ; statistical blundering of the Scottish clergy, ib. ; quoted as to the wages of labour varying as much in Scotland as in England, ii. 267 ; his Statistical Account of Scotland quoted touching the Poor-laws, 296-298. Sirach, (Son of,) quoted as to the divi¬ sion of labour, i. 328, seq. Size of properties, see Properties ; of farms, see Farms. Smith, (Dr. Adam,) adduced as to the meaning of the term Political Eco¬ nomy, i. 8, 9 ; quoted as to manufac¬ turers, 15 ; as to education, 50 ; as to the progress of population in America, 6L ; as to misery and po¬ pulation, 78, 102, 103; on the nutri¬ tive power of the potato, 100, 105 ; referred to as to the history of Agri¬ culture in Europe after the fall of the Roman Empire, 113; quoted as to the colonus partiarius and metayer, 114; referred to in regard to farm leases, 115; according to him the law securing the longest leases is peculiar to Great Britain, 117 ; quoted against the impolitic burdens upon Agriculture, 121, seq. ; adduced as in favour of large farms, 127 ; quoted as to the influence of Manufactures upon Agriculture and Population, 157, 170, 175; as to Colbert’s injudicious en¬ couragement of Manufactures at the expense of Husbandry, 162 ; his censure upon Quesnai and the Eco¬ nomical System adduced and esti¬ mated, 163, 179, seq. ; on the effect of machinery in superseding manual labour, 193 : on the increase of po¬ pulation in various countries during the last century, and on its conditions, 237 ; his opinion in regard to the comfort of the labourer controverted, 251, 252 ; doubt in regard to his criticism of the French Economists, 252 ; his system contrasted with theirs, in regard to the notion of National Wealth , 253, 255, seq., 294 ; two circumstances on which, accord¬ ing to him, the opulence of a country depends, — 1°- the proportion of the usefully employed to the idle ; 20, the skill, dexterity, and economy with which their labour is applied, 256 ; his opposition to the Economists in regard to the productive powers of manufac¬ turing industry, 262 ; his argument, in this respect, controverted by the Author, 263, seq. ; how far he and the Economists coincide with respect to the fact on which they both prin¬ cipally found, that of natural produc¬ tion, 270, seq.; speaks of agricultural and manufacturing labour as both productive , though not in an equal degree, 271 ; rejects as inaccurate the term unproductive, as applied by the Economists to manufacturing in¬ dustry, 272, 279; on his doctrine of productive labour, 279, 280 ; this doctrine specially considered, 280, seq.; in what countries his doctrine fails of application, 285 ; his doctrine of the productiveness of labour cor¬ rected, 286, 287, 290, 294 ; against the project of an extensive territorial INDEX. 487 tax, 301 ; ii. 237 ; what is the charac¬ teristic excellence of his great work ? 305 ; his system and that of the Economists compared, 306 ; his praise of the Economists, 306, 307 : referred to generally on the division of labour, 310, seq. ; quoted particularly on the same, 312-316; on the use of machi¬ nery as a substitute for labour, 316, seq. ; Author’s criticism of this doc¬ trine, 317, seq. ; quoted as apparently borrowing from Mandeville, 323, seq. ; his speculation on this subject not erroneous but incomplete, 326, seq. ; adduced as to the history of money, 333 ; quoted as to the intrinsic utility and value of the precious metals, 335 ; criticism of his opinion on this sub¬ ject, 335, seq. ; doctrine of, touching real and nominal prices, 350, seq., 357, 358 ; on what principle should the value of money at different times be estimated? 352, seq. ; holds that the amount of labour affords the real measure of exchangeable value, 353 ; this doctrine combated, 353, seq. ; his doctrine praised in regard to the comparative value of the precious metals, 375 ; holds that the quantity of the precious metals may increase in a country from two different causes, 384, 385, 447 ; Author’s dis¬ sent from Smith in this respect, 447 ; on this distinction replies to Hume in regard to banks and paper credit, 385, 388, see also, 431 ; this, his reasoning, invokes sound principles, and also material mistakes, 388 ; notices that the rents in England, which have been reserved in corn, maintain their value better than those reserved in money, 390 ; his doctrine in regard to the component price of commodities, 391, seq.; ii. 5, seq. ; has exhausted the doctrine of interest less than most other questions, 398 ; his opinion in regard to the rate of interest, 399, 400, 417, seq. ; to faci¬ litate the study of his Inquiry is a principal object of the Author in these Lectures, 425 ; quoted as to the rapidity of circulation, 435 ; seemed to think that the discovery of the American mines was the sole cause of the proportional diminution in the value of the precious metals, 448 ; his doctrine on the freedom of trade, ii. 3, seq.; quoted in regard to the industry of towns and of country districts, 15, seq. ; on and against the Commercial or Mercantile system, 22, seq. ; ad¬ duced as to the amount of grain im¬ ported into Britain, and to the small dependence that should be placed on Political Arithmetic, 48 ; quoted as to the utility of a rise in the price of grain in seasons of scarcity, 50 ; asserts that a dearth has never arisen from a combination of corn-dealers, but may arise from the impolitic at¬ tempts of government to remedy the inconveniences of a scarcity, 51, 52 ; quoted as to the causes of the frequent dearths formerly prevalent in England, 58 ; apology for the absurd regulations in reference to the Corn Trade, under almost all governments, 82 ; quoted from his Theory of Moral Sentiments, 85 ; as to the advantages of the im¬ portation of corn, 101, seq. ; as to the English laws regarding the im¬ portation of corn, 107 ; adduced in regard to the Corn Trade, 114; quoted in regard to the impolicy of bounties, 116 ; accused by Dr. Gillies of plagiarizing from Aristotle, 148 ; his opinion in favour of the laws against usury, 160 ; quoted to the same effect, 168; against the policy of state interference in controlling projects, 171 ; seems to hold that anti-usurious laws are completely nugatory, 180-188; explains Primo¬ geniture, 201 ; quoted on the neces¬ sity of taxation in modern states, 212 ; on the political necessity of borrowing in modern times, 214 ; on the progress of the public debt, 215 ; on the policy of the English Funding System, 216 ; adduced against the National Debt, and against the theory of Pinto, 218 ; his four maxims touching taxation, 221, seq. ; his arrangement of the discussion upon taxation under four heads, 224; on the policy of the English land-tax, 228, 229 ; on the certainty of this tax, 229 ; on its advantages in general, 231 ; on the variable land-tax, 235, 236 ; adduced in regard to valuations of land in various countries of Europe, 241, 242 ; as to tithes in Bengal, 247 ; as to a house-tax, 248 ; against the English Law of Settlement, 266 ; defended by the Author, on this point, against certain English critics, 267, 268 ; rightly condemns the Law of Settle¬ ment, in so far as it arbitrarily re- 488 INDEX. moves a man from any parish where he chooses to reside, 269 ; have the wages of labour kept pace with the expense of necessaries ? 284 ; against the opinion that cheap food encourages idleness, 312 ; does the cheapness of spirituous liquors encourage drunken¬ ness? 317; on the education of the lower orders, 327 ; adduced in refer¬ ence to this subject, 339, 340 ; his great maxim, that between nations, as between individuals, — Honesty is the best policy, 348 ; his Inquiry re¬ commended for study in the conclu¬ sion to the Course on Political Eco¬ nomy Proper, 458. Smith, (Charles, author of the Corn Tracts ,) on the proportion of the con¬ sumption of the different kinds of corn to population, i. 219, 220, 368; ii. 125, 126 ; his pamphlet adduced in reference to the population of England and Wales, 248 ; as to the average importation of grain into Britain, ii. 48 ; that a third of the nation did not eat wheaten bread, 58 ; his Tracts adduced, 68, 84, 108, 109 ; quoted as to the corn importation in Turkey, 110, 111 ; adduced as to the Corn Trade, 1 14 ; his Corn Tracts recommended for study at the close of the Course on Political Economy Proper, 459. Smith, (Sir Thomas,) commemorated his provision of reserving college rents in corn, i. 390. Smith, (William,) adduced in regard to political expedients for choosing sena¬ tors in the States of Maryland and Kentucky, ii. 433, 434. Society, organization of, in the ancient republics, i. 36-38. “ Society for Bettering the Condition of the Poor,” its Reports quoted, ii. 307- 309 ; referred to, 322, 323. Sommerville, (Rev. Dr.,) quoted in re¬ gard to the Scottish Poor-Laws, ii. 295, seq. Sovereignty, see Monarchy. Spain ; mistaken policy of its govern¬ ment in respect of the stimulus to population, i. 199, 200. Spartan Commonwealth, on its nature, ii. 402. Spectator , referred to as to the varying value of the precious metals, i. 373. Spelman, quoted as to Gavelkind, ii. 198. Stafford, (W.,) adduced in reference to Enclosures, i. 135. Standing Army, origin of, ii. 421. Stewart, (Col. Matthew,) letter of, con¬ taining an account of the destruction of his father’s manuscripts, i. x., seq. Stewart, (Dugald,) on the composition of his Lectures on Political Economy , i. vii., seq. ; his relation to Adam Smith as to these, ix. ; loss of the MSS. of these Lectures , ix., seq. ; how far these Lectures were prepared for publication by the Author, xi., seq. ; their contents as so prepared, xii., seq. ; list of MSS. destroyed, ib. ; the character of their contents, xvi. ; summary of his Course of Political Economy in its earlier form, xvi., seq. ; how far his own MSS. have been em¬ ployed for the present publication, arid liow far recourse has been had to the Notes of auditors, xxi., seq. ; in what extent he employs the term Political Economy , 9, seq., 16, 21 ; omissions from his more recent lectures on this subject, noticed, 252 ; a principal aim of these Lectures is to encourage and facilitate the study of Smith’s In¬ quiry , 425; his doctrine in regard to a circulating medium, 442 ; his plan of taxation by a Register of Leases, ii. 235, 239, 241 ; doubtful as to the expediency of withdrawing from the poor all compulsory legal relief, 277, 279, seq. ; obviates objections against a nimious education of the poor, 337, 338, seq. ; recommends various books on Political Economy Proper, 458, 459. Stewart, (Miss,) Table of Contents by her to the volumes of her father’s manuscripts, i. xvi. ; her testimonies touching these manuscripts, 18, 30, 31, 32, et pluries. Steuart, (Sir James, of Coltness,) adduced as to the meaning of the term Political Economy, i. 8, 9 ; quoted as to the difference of labour and industry, 36 ; referred to as to the unfavourable influence of poverty on population, 103 ; as insisting on the distinction of agriculture as a mere mean of subsistence, and as a competing trade, 142 ; in this respect quoted, ib. ; quoted as to the division of properties in France, 151 ; as to the encourage¬ ment to Agriculture given by cities, 152, seq.; as to the influence of Ma¬ nufactures upon Agriculture, 156, seq., 178; referred to in relation to INDEX. 489 the same, 171, 177 ; quoted as to the effect of machinery in superseding labour, 193 ; shews that a distinction of the different kinds of population must be taken into account in esti¬ mating the prosperity of a nation, from the number of its people, 198, seq. ; as against the project of an exclusive territorial tax, 301 ; ii. 237 ; as to the opinion of Montesquieu in regard to the variations in the value of the precious metals, 373, 376, seq.; opposes Hume in relation to this value, 375 ; quoted as to the circula¬ tion of money, 381, 437, 447 ; what regulates prices, 393 ; his opinions as to the Corn Trade, ii. 75, seq. ; his oversight as to the limitation of a price in corn, 137-140 ; quoted to the effect that taxes should be always imposed according to superfluity, 223 ; “ on the fruits and not on the fund,'" 224 ; explains the English land-tax, 228 ; of the policy of the same tax, 229, 230 ; on the uncertainty of this tax, 229 ; adduced as to the extent of tithe in Italy, 244 ; on the Mare- chal de Vauban’s proposal to substi¬ tute the Dime Royale for other taxes, in France, 246 ; his Inquiry into the Principles of Political (Economy re¬ commended for study in the conclu¬ sion of the Course, 458. Stock, profits of, the two circumstances affecting, ii. 11. Stowe, (Mr. John,) on the varying prices of the different kinds of corn in Eng¬ land in the older times, i. 369; quoted as to the prosperity of England under James VI., 412. Strabo, adduced as to the proportions among the population of a country, i. 224. Stuart, (Dr. Gilbert,) quoted as to the apparent violence in the marriages of antiquity, i. 75 ; does he suppress the testimony of Tacitus in regard to the prevalence of Polygamy ? 85 ; his statements touching Monogamy criti¬ cised, ib. ; quotes Tacitus as to Ga¬ velkind, ii. 199 ; adduced in regard to the old valuation of land in Scot¬ land, 232. Succession, in land, laws of, see Entail, Primogeniture, Land ; in the Crown, no fixed order of, in a despotism, ii. 396, 397. Suessmilch, (Ilcrr,) his work, The Di¬ vine Order , &c., referred to as to the proportion of the sexes born in Ger¬ many, i. 88, 89, quoted in regard to the Agrarian laws of Rome, 138 ; praised, and its contents enumerated by Hertzberg, 221 ; praised by Dr. Price, ib. ; referred to as to the pro¬ portion of births to inhabitants in Prussia, 223 ; that great Treatise on Population recommended by the Author in the conclusion of his Lec¬ tures on Political Economy Proper, ii. 458. Suetonius, referred to touching the Ro¬ man laws against celibacy, i. 93 ; quoted in regard to the chronic alarm as part and parcel of the Roman des¬ potism, ii. 396. Suidas, quoted as to the institution of Marriage by Cecrops, i. 71. Sustenance, cheaper modes of, to be urged upon the poor as a mean for the increase of food, ii. 141, 142 ; cheap modes of, in general, as a mean of in¬ creasing the supply of food, 142, seq. Switzerland, good effects of the educa¬ tion of the lower orders in, ii. 333, 334. Sydney, see Sidney. Symonds, adduced as to the public ma¬ gazines of corn in Italy, ii. 62. Tacitus, quoted as to the modesty of the ancient Germans, i. 75 ; as to their exceptional polygamy, 84 ; re¬ ferred to in regard to the legal dis¬ couragements of celibacy among the Romans, 94 ; as to the law of succes¬ sion among the Germans, ii. 197 ; erroneously quoted by Spelman in regard to Gavelkind, 198, 199 ; quoted by Gilbert Stuart as to primogeniture among the Germans, 199 ; alluded to as describing the British and German pastoral state, 201 ; quoted as to the servility of the Roman patricians dis¬ gusting even the emperor, 393 ; la¬ ments that his Annals are of so base a purport, 395 ; quoted as to the essential forms of government, 417. Taille, a tax upon farm tenants in France, i. 121, seq. ; real and per¬ sonal, ii. 250, 251. Taxes, as a burden upon farmers, i. 120, seq.; establishment of, in England, under Charles L, 413 ; on, comprehen¬ sively, ii. 211-253; introduction to the consideration of, 211-224; ends 490 INDEX. for which taxes are instituled, 211 ; substitute for taxes among ancient nations, ib. ; by modern princes, 211, 212 ; necessity of, in modern states, 212 ; in these, the great object of Finance, 213 ; Adam Smith’s four maxims touching, 221 ; on these maxims, 221-224; a fifth added by the Author, 224 ; different kinds of, as from three different sources, enu¬ merated, 224 ; taxes upon Land, 225- 247 ; upon Houses, 247, 248 ; upon Profit, 249-251 ; upon Consumption are preferable, 251, 252 ; upon In¬ come, 253 ; exclusive tax on all pro¬ perty by Succession proposed ; see Land. Taylor, (Dr. John, the Civilian,) quoted as to the seeming violence of the Ro¬ man marriage, i. 75, 76; adduced as affording several authorities for Ro¬ man luxury, 147. Temple, (Sir William,) his comparison of the state to a pyramid, referred to, i. 32. Tenths and Fifteenths, were in England temporary aids out of personal, not landed, property, ii. 226. Tevray, (Abbe,) withdrew the freedom of the corn trade in France, ii. 63. Territorial Tax, doctrine of the Econo¬ mists in relation to, i. 295, seq., 297, seq. ; ii. 221, 237; the advantages which are by them attributed to such a tax, 296 ; expediency of, 297 ; ad¬ vocated by Locke, 298, seq. ; by Van- derlint, 299, seq. ; by Asgill, 300 ; by Chamberlayne, 300, seq. ; by the eider Mirabeau, 301 ; ii. 237 ; by Le Trosne, 301 ; by various writers col¬ lected by Dupont, ib. ; opposed by Necker, Sir James Steuart, Pinto, Adam Smith, the Marquis de Casaux, and by M. Graslin, in his Essai sur la Richesse, &c., ib., ( see also, ii. 237 ;) the Author holds that its advant¬ ages might be attained by a Regis¬ ter of Leases, ii. 235, 239, 241. See Land. Theophrastus, the word Woman does not occur in his Characters, i. 56. Thornton, (Henry,) quoted as to Circula¬ tion, i. 431-434, 441, 443-445; as to the market price of commodities, ii. 7, seq. ; referred to as to the Corn Trade and Paper Credit of Great Britain, 139. _ 7'hucydides, quoted as to the spirit of the Athenian government under Peri¬ cles, ii. 369 ; that under him it was in reality a monarchy, 403 ; as to the success of stupidity in democratic contests, 371. Tiberius, what he meant in calling spies and informers the guardians of the state, ii. 395. Timber: forced plantation of English oaks, policy of, ii. 26, seq., 40, seq. Tithes, as a burden upon Agriculture, i. 122, seq., ii. 244, seq. Towns, see Cities. Townsend, (Rev. Joseph,) adduced in regard to the mistaken policy of Spain in the encouragement of population, i. 199 ; remarkable quotation, touch¬ ing the principle of Population, from his Dissertation on the Poor-Laws, 206 ; on the progress of commerce during the eighteenth century, 238 ; referred to as to the quantity of food necessary for a horse, 250 ; quoted against Workhouses, ii. 271, 272. Trade, ancient and modern, difference of, i. 38, seq. ; on, in general, ii. 3- 210 ; Freedom of, see Freedom ; Bal¬ ance of, see Balance. Trosne, (Le,) adduced in favour of a territorial tax, i. 301 ; ii. 242. Trotter, (Mr. Coutts,) alleged and criti¬ cised, i. 450, 451. Tucker, (Josiah, D.D., Dean of Glou¬ cester,) against the Mercantile system, ii. 33. Turgot, (M.,) adduced as to the French Metayer, i. 113 ; praised, 289, et alibi ; indistinctness of his definition of pro¬ ductive and unproductive labour, 295 ; referred to as to the precious metals being the most convenient substances for coin, 333, 334 ; as to the nature and use of capital, 396, 397 ; his ser¬ vices in emancipating the corn trade of France, ii. 63, 64 ; vindicates usury, 157, 193 ; quoted as to the advantage of a low rate of interest, 191 ; as to the paramount importance of agricul¬ tural labour, 196; bis opinion against the liberty of Latter Wills, 204 ; ad¬ duced in favour of a territorial or land- tax, 237 ; his Reflections on Riches, &c., recommended for study in the conclusion of the Course on Political Economy Proper, 458. Turkey, serves as Montesquieu’s model of Despotism, ii. 410. Turton, (Sir Thomas.) a pamphlet of his adduced in regard to the importation of corn, ii. 109. INDEX. 491 Union, Treaty of, between Scotland and England, Article of, regulating the proportion of the land-tax to be raised, in the former country, ii. 234. Usury and Interest, on their connexion really and verbally, i. 411 ; should it be regulated by law ? on, in general, ii. 146 195 ; Aristotle’s doctrine as to its morality, 146, seq. ; on the meta¬ phor of money breeding money, 147 ; in its unrestricted signification, in¬ cludes all exaction of any interest, 148 ; abhorrence of usury, or taking of any interest for money, common to all forms of religious opinion, 151 ; laws against, only aggravate the dis¬ tress of the unfortunate, 178, seq.; in Russia, laws against are a dead letter, 181; in England, virtual usury at least is permitted by law in the case of Drawing and Redrawing, 182 ; also in Pawnbroking , 182-186 ; also in what is called Bottomry and Respon¬ dentia, 186 ; laws against held by the Author to be impolitic, 184, seq., 190. See Interest. Utility, degrees of, as applied to com¬ modities, i. 359 ; the intrinsic utility of a commodity, what? 360. Valerius Maximus, quoted as to di¬ vorce among the Romans, i. 81 ; as to the effect of a contumelious joke on the Roman electors, 144. Valuation, standard of : according to our Author, corn, or the ordinary food of the people, affords the best, i. 361, 362. Valuations, or Land Surveys, might, the Author thinks, be accomplished by a Register of Leases, ii. 239. Value : exchangeable, of everything manufactured depends on two cir¬ cumstances, — the price of the raw material, and the price of the labour expended on it, i. 261 ; the word value has two different meanings, — sometimes expressing utility of a commodity, (value in use,) sometimes the power of purchasing other goods, (value in exchange,) 355, 259 ; the accuracy of this distinction canvassed, ib. ; vacillation by authors in the use of this term, 355, seq. ; with what meaning is it employed by the Author? 359; value of money used in two different senses,— either for the quantity of the precious metals to be given in exchange for commodities, or for the proportion between a sum of money and its interest in the market, 408, 409 ; these two modes of valuing money have little mutual connexion, 409 ; their difference has, however, escaped the attention of some respectable writers, 409, seq. Vanderlint, (Jacob,) quoted in regard to an exclusive territorial tax, i. 299, seq., ( see also, ii. 239 ;) in favour of the freedom of commerce, ii. 34, seq. Vauban, (Marechal de,) quoted as to the effects of want on population, i. 103 ; his proposal to substitute the Dime Royale for the Taille, &c., ii. 246. Vaughan, (Mr. Rice,) quoted as to the wages of labour constituting a crite¬ rion of real prices, i. 364 ; as to wheat affording a standard for the exchangeable value of money in a nation, 370. Vaughan, (Mr. William,) his Treatise on Commerce referred to, ii. 79. Venice : Venetians, (along with the Genoese,) originators of the Funding System, in the sixteenth century, ii. 214 ; their nobles debarred from trade, 383 ; constitution of the legislative senate under the old government, 435. Villanage, effect of its suppression upon Population, i. 187, 210, seq. Virgil, his description of Neptune, calm¬ ing the winds and waves applied to the moral influence of a man in authority over a popular assembly, ii. 362. Virtue, what its meaning by Montes¬ quieu as the principle of a democracy? ii. 408. Vizier, necessity for such a minister in an Absolute Monarchy, ii. 390. Voght, (Herr Caspar,) on the expendi¬ ture for work-houses in England, ii. 274 ; alleged as to their management in Hamburgh, 303-305. Voltaire, adduced in praise of Galiani, ii. 66 ; quoted as to the incompatibi¬ lity of original genius with cultivation, 344 ; as to Montesquieu, 412. Wages: have the wages of labour in England latterly increased ?ii. 283, seq. Wales, (William,) as an antagonist of Dr. Price, with respect to the pro¬ gressive unhealthiness of London, i. 231 ; on the increasing population of 492 INDEX. Great Britain, 234, 235 ; on the po¬ pulation of London, 244. Wallace, (Robert, H.D.,) adduced as to increase of population, i. 63 ; as to Roman fortunes, 146, 147 ; quoted as to government and population, 204, seq. ; how his speculations on this subject were warped, 211 ; as to the proportion of men capable of bearing arms to the general population of a country, 224 ; on the population of the globe and its several quarters, 232 ; coincides with Hume in regard to the value of the precious metals, 373, 374 ; dissents, however, from his conclusions, 375 ; referred to touching the circulation of money 381 ; as to the money value of grain in anti¬ quity, 381, 448 ; his work, On the Numbers of Mankind , commemorated in the conclusion of the Course, ii. 458. Warburton, (Bishop,) quoted against providing for the Poor by law, ii. 324. Wargentin, (Herr,) as to the proportion of the sexes born in Sweden, i. 88 ; as to the proportion of annual births in Sweden, 222. Waste Lands, Parliamentary Committee on, first Report of, showing the pro¬ gress of Enclosures, i. 239 ; how they may be turned to advantage in the increase of population, ii. 141. Watchmaking, illustration from, ii. 12, seq. Watt, (Robert, M.D.,) his Bibliotheca Britannica adduced by Editor, i. 202, 275, 326, 333, et alibi.. Wealth, ancient and modern, i. 148. Wealth, National, a branch of Political Economy Proper, i. 33, seq. ; on, in general, forming Book II. of Political Economy Proper, 253 ; ii. 253 ; on the meaning of the phrase, 253. Webster, (Rev. Hr.,) on the statis¬ tics of Scottish population, i. 245, 246. Wedderburn, (Lord Chancellor Lough¬ borough,) quoted in regard to Bills of Enclosure, i. 136, 137. West Indies, our colonies in, rate of in¬ terest there, i. 417, seq. Wheat, consumption of, progress of, in various parts of England and Scot¬ land, i. 248, 249 ; not alone affording an example of the common food of the people, 368 ; ii. 57, 58. Whitbread, (Samuel, M.P.,) against any compulsory support of the Poor, ii. 279, 281 ; on the advantages of Sav¬ ings Banks, 313. Wills, Latter, policy and impolicy of restraints on, ii. 204, seq., 208-210. Winclielsea, (Lord,) the advantages of the potato as an economical article of food, inculcated by, ii. 142 ; his Paper on the Poor referred to, 323. Witt, (John de,) quoted as to the free¬ dom of trade, ii. 18, 19. Woods and Forests, Reports of the Commissioners of, ii. 40, seq. Workhouses, as charitable institutions, ii. 300-305. World, see Globe. Wotton, (Sir Henry,) quoted as to good laws and a good nature, i. 49. Xenophon, his treatise On the Improve¬ ment of the Revenue of the State of Athens , adduced, i. 36, seq. ; quoted as to the division of labour and its effects, 311, 312 ; adduced as to the Athenian republic, ii. 362, 403, 404 ; as to the Spartan commonwealth, 402. Young, (Mr. Arthur,) holds that Popu¬ lation should be regarded as subordi¬ nate to Agriculture, i. 66 ; as to the population of Ireland, 99 ; as to pota¬ toes, the food of the Irish, 101 ; as to the comparative universality of mar¬ riage in Ireland, 102 ; quoted in fa¬ vour of pasturage, 106-108 ; against the impolitic burdens upon Agricul¬ ture, 122 ; referred to in relation to large farms, 126 ; in favour of large farms, 127, 130, j.31 ; quoted as to the comparative profit of arable and pas¬ turing Agriculture, 138 ; adduced as to the Roman policy in regard to Agriculture, 141 ; quoted as to the subdivision of properties in France, 148, seq. ; as to the influence of Manu¬ factures upon Agriculture and Popu¬ lation, 158, seq.; as to these in special reference to France, 163, seq.; to Ire¬ land, England, and Italy, 165-167 ; his opinion in regard to the pernicious influence of Manufactures upon Agri¬ culture controverted, 168, seq. ; ii. 199 ; his inconsistency in this relation shewn, 171-178 ; shews that a dis¬ tinction of the different kinds of popu- INDEX. 493 lation must be taken into account, in estimating the prosperity of a nation from the numbers of its people, 199 ; controverts Dr. Price in regard to the decline of popidation in Great Britain, 234 ; liis estimate of the numbers of persons engaged in farming, 240 ; on the population of England and Wales, 243 ; coincidence of bis opinion, in regard to the value of the precious metals, with those of Hume and Wal¬ lace, 374 ; on the policy of the F rench government in regard to the Corn Trade, ii. 72, seq .; quoted in reference to this trade, 82 ; his opinions in re¬ gard to this criticised, 83, 84 ; adduced in regard to the Corn Trade, 114 ; in regard to the dearth of 1799-1800, 122, seq. ; his Table shewing the avei’- age prices of wheat for the year fol¬ lowing the harvest of 1798, 128 ; his opinion in regard to the relation of the price to the plenty and scarcity of grain, not very explicit, 132, seq.; adduced in praise of milk as an eco¬ nomical article of diet, 142 ; also of potatoes, 143 ; as to the meaning of ability , 222 ; quoted as to the disad¬ vantages of a variable land-tax, 236 ; noticed as against an exclusive land- tax, 237 ; quoted in regard to tithes, 245 ; adduced as in favour of taxes on consumption, 252 ; in favour of the project of a limited assessment for the poor, 278, 280 ; in regard to a paradox, — that a liberal reward of labour encourages idleness, 311 ; his Annals of Agriculture quoted, 321, 322. Young, (Sir William,) reprobates the English Law of Settlement, ii. 269. Zimmermann, his Political Survey of Europe quoted, i. 214. KPINBL'RGn * T. COHSTA HI.E, PRINTER TO HKR MAJR8TT. I r00 ■ItJ _ i[W je-J • < •; PROSPECTUS. In handsome 8vo, with Portraits , Sc., price 12s. per Volume , COMPLETE EDITION OF THE WORKS DU6ALD STEWART, ESQ., COMPRISING, AMONG OTHER LARGE ADDITIONS, A CONCLUDING CHAPTER OF HIS DISSERTATION, LECTURES ON POLITICAL ECONOMY, &o. &o. WITH A BIOGRAPHICAL MEMOIR OF THE AUTHOR By SIR WILLIAM HAMILTON, Bart. After the death of Reid, Dugald Stewart was the head of what has been denominated u The Scottish School of Philosophy long before his death he was, indeed, universally acknowledged as the most distinguished living philosopher of Great Britain, and likewise as one of the best writers in the language. His published works are con¬ siderable, both in number and extent, and are also conversant with the most important parts of Philosophy, — historical, speculative, and practical. Of these works, the earlier have been frequently re¬ printed ; but from circumstances, merely private, and which it is un¬ necessary to specify, new editions of his later writings have been withheld, and a collection of the whole, which ought long ago to have appeared, has only now become possible. This Collection, which it is proposed forthwith to publish, will appear in handsome 8vo, and may extend to nine, perhaps to ten, volumes. It will not be merely a uniform re-impression of the former Publications. These it will of course comprise, — following the most authentic Edition, with the Author’s Manuscript Corrections, and his frequent and important Additions but in the extensive literary re- 2 mains of Mr. Stewart, besides the Writings thus left prepared for the Press, there are others which may afford valuable extracts to be incorporated in the already published Treatises, — or to be otherwise annexed to them. The work of selecting from the Manuscripts, and, in general, of editing the Collection, has been undertaken by Sir William Hamilton, who will likewise supply a Memoir of the Author. The contents of the Publication are as follows ; and, in so far as at present appears, they will occupy Ten volumes. 1. Dissertation, exhibiting a General View of the Progress of Metaphysical, Ethical, and Political Philosophy. This will comprise numerous and extensive Additions, and a Chapter hitherto unpublished, exhibiting a concluding view of “ Tendencies and Result.” 2, 3, 4. Elements of the Philosophy of the Human Mind. 3 vols. To this will he prefixed Part I. of the Outlines op Moral Philosophy, containing the Outline of the Philosophy of Mind. The first volume will contain the relative Addenda published in the third, which are still in copyright. In the second volume will appear various Inser¬ tions and Corrections. The Outlines also have some additions. 5. Philosophical Essays. This volume may be considered as almost a part of the last work. — Large additions. 6, 7. Philosophy of the Active and Moral Powers. 2 vols. There will he prefixed Part II. of the Outlines of Moral Philosophy, containing the Outline of the Ethical Philosophy. — Considerable Additions. 8, 9. Lectures on Political Economy. That is, on Political Philosophy in its widest signification. Now first published. Part III. of the Outlines op Moral Philosophy, con¬ taining the Outline of the Political Philosophy, will be prefixed. 10. Biographical Memoirs of Smith, Robertson, and Reid. Additions ; with Memoir of the Author by Sir William Hamilton. EDINBURGH : THOMAS CONSTABLE & CO. HAMILTON, ADAMS, & CO., LONDON. sd / BIX ; r-r<|j *•- r. .afc- . sras ialft