UPON THE PROBABLE INFLUENCE REPEAL OF THE CORN LAWS, TRADE IN CORN. LONDON - : JAMES RIDGWAY, PICCADILLY, 1846. ON THE CORN LAWS. It is contended, that a free trade in corn would be also a regular trade, in which capital would he securely and permanently invested, in which ships would he regularly and exclusively employed, for which foreign markets would be regularly prepared, for which foreign agriculturists would regularly provide by growing corn, not for their own country¬ men, but to meet the demands of the external trade, which would thus be created; and further, that the effect of this regular provision of produce, would give steadiness to prices, and supersede alto¬ gether the apprehensions of a scarcity from a defi¬ cient harvest at home, whether it was foreseen or not •, it would also prevent, as is asserted, those dangerous derangements of the currency which arise from the necessity of sudden and large im- 4 portations of com from countries with which wc have no regular or extensive commercial trans¬ actions. These arguments, which have always been put prominently forward by the opponents of the Corn Laws, (as a reference to any of the former or recent Com Law Debates, would immediately shew) ap¬ pear to us to he untenable: we will give our reasons for thinking so. They assume that a free trade, whether in corn or any other commodity, is also a regular trade, considering those terms in the operations of com¬ merce, as absolutely convertible with each other. But it should be observed, that a free trade can only become regular in those cases in which the supply and the demand are equally so. Thus cotton is the production of countries whose sea¬ sons are much less irregular than our own: the variation in the annual produce is much less con¬ siderable than in the cereals of less genial regions : more than two-thirds of the American and most other crops are transferred to this country, where they compete with no rival produce, the same quan¬ tity or nearly so being required for several successive years for the purposes of our manufactures. Now the trade in this great staple of our manufacturing industry is free, because it is fettered by no duties either of import or export: it is also regular, be¬ cause the supply and the demand are regular or nearly so: it requires every year nearly the same amount of shipping: it is carried on generally by the same houses: it puts into action nearly the same machinery of production, transport and manufacture: and though the material, which is the basis of this important traffic, is subject to great variations of price, like all other productions which are, in any way, dependent upon the caprices of the seasons, even when they are much more fixed and regular than our own, yet it presents features of steadiness and regularity in its whole progress, which are rarely met with in the greater operations of commerce. Again, the trades in sugar, coffee, and tea, though affected by fiscal regulations of a very com¬ plex kind, are sufficiently regular, presenting no very marked variations from year to year ; the trade also in French and other wines, and number¬ less other articles, though subject to duties which very greatly limit their consumption, is perfectly regular and steady : and the same observation may be extended to the trade in nearly every article of consumption, whether a necessary of life or not, which does not come into competition with the domestic produce, whether of our agriculture or our manufactures: but it may be safely asserted, that every trade, however free, ceases to be regular, whenever the demand for the material in which it deals, ceases to be regular in its quantity, and therefore in its price. 6 None of these essential conditions of a regular trade belong to a trade in corn, even if it was perfectly free and uncontrolled: our domestic produce is suffi¬ cient for our domestic consumption, in two years at least out of three: in the vicennial period from 1821 to 1S40 inclusive, we find 13 years in which little or no corn was imported: in 1844; our produce was supposed to be equal to at least 14 months consumption : and rapid as is the increase of our population, and, we trust we may add likewise, of the comforts of the lower clases, yet the improve¬ ments of our agriculture have fully kept pace, (as we shall hereafter endeavour to shew) with the increase of the demands made upon our resources: and there is no reason to suppose, unless the ad¬ vance of agricultural improvement, more particu¬ larly in draining, should be prematurely checked, that our produce, should not continue, for many years to come, to increase at least as rapidly as our population. There appears, therefore, to be wanting nearly every element of a regular trade for the importation of com into England, inasmuch as the demand which might be considerable in one year, would cease altogether in the next. Let us assume, however, by way of hypothesis,that capital should he permanently invested in the com trade: that ships should be built and chartered for it: that they should proceed to those ports, in whatever quarter of the globe situated, from whence corn could be most advantageously purchased : that they should continue to import, without reference to the state of our markets, as much corn as they could convey: let us assume, also, that their powers of annual importation were equal to one million quar¬ ters of wheat; and let us inquire into the conse¬ quences which might be expected to follow from its operation. For this purpose, let us farther assume, as an hypothesis merely, the average annual consumption of wheat in England to be 17 millions of quarters, and its average annual produce to be 16 millions; and likewise that the capacity of consumption be¬ tween a year of cheap corn and general prosperity, and one of dear corn and general suffering from want of employment and other causes, to vary from 19 to 15 millions ; and the produce between a year of the greatest abundance, and a year of the greatest scarcity to vary from 19 to 13 millions (suppositions which are probably not very far from the truth); and assuming, also, that our domestic produce, in a cycle of seven years, decreased an¬ nually by a million of quarters from its highest to its lowest amount: then it would follow that the uniform importation of a million of quarters would depress extremely the prices in the earlier years of the cycle, and would fail to prevent a famine in the two last. Such a trade in corn would assume, therefore, at one period, the character of a rash and 8 foolish speculation; at another it would altogether fail to satisfy the wants of the population. It is hardly necessary to say, that the trade, in the earlier years of such a cycle, would be altogether abandoned; whilst in the later, it would be greatly and rapidly extended. Nor would these interruptions of the continuity of the com trade be prevented by any other sup¬ position which we can make, with respect to the succession of seasons of abundance and scarcity, even if they were alternate, the regularity of the trade could only be maintained by a system of storing the imported com, to an extent, and with a loss, which would be ruinous to the importer: but it is hardly necessary to observe, that all calculations of the probable course of such a trade would be defeated by the real succession of the seasons. Much stress has been laid upon the argument, that if foreign countries were secure of a market for their produce, which prohibitory duties would not arbitrarily close, they would always be prepared with stocks of com sufficient for our wants, however great they might be: for they would be stimulated by the profits of the trade to extend their cultiva¬ tion, so as to be prepared for the external as well as the domestic demand. It may be quite true, that as long as the prices of com abroad should continue to rise, its cultivation would continue to extend: but the limit of such a change, as far as it depended upon the English market, would he speedily attained: the whole amount of wheat which would annually be required to replace the average deficiencies of our harvests, would not exceed 1 -50th part of the produce of Europe, a quantity quite sufficient to affect materially the markets which are at present easily accessible to us, but not to exercise a very great and permanent influence upon the pro¬ ductive powers of every region in the world to which our trade in corn might extend: for even if we should grant that the primary effect of the opening of our ports should be a general increase of produc¬ tion abroad, yet it would be speedily checked by the irregularity of the demand, and the great fluctuation in price to which it would be exposed, particularly in countries, like Poland and Prussia, where wheat does not constitute the staple food of the people, and where the portion of it which is grown for fo¬ reign markets, is not easily absorbed, when prices are low, by increased consumption at home. Again, it may be further observed, that the foreign growers of corn, with a view to the supply of our markets, would not only be exposed to competition with our domestic produce in years of abundance, but likewise with the cheapest markets which are accessible to our commerce in years of scarcity: thus wheat in Poland may be cheaper than in Eng¬ land, yet dearer, (differences of freight being de¬ ducted,) than.in America : and it is only after the 10 extent of our demand has raised the price of Ame¬ rican to the level of Polish wheat, that the latter would be sought for by our merchants. An indefi¬ nite competition of this nature would effectually check the exclusive production of com for the Eng¬ lish market, without reference to the prices in the lowest market, wherever situated, from which sup¬ plies might be expected to be procured. It is not, however, very easy to define the pro¬ bable effects which would be produced on foreign markets and our own, by the opening of our trade : we may be perfectly certain that prices at home would be depressed, and those abroad would be raised, until they merely differed from each other by the cost of importation: and we should natu¬ rally conclude that the depression would be more considerable than the rise, inasmuch as the amount of foreign produce is incomparably greater than our own, and therefore less likely to be influenced by an importation which might be inconsiderable, with reference to the mass from which it was taken, but large with respect to that to which it was added. It may be quite true, however, that the quantity of com in foreign markets, which would be, in the first instance, in a condition to be imported, might bear a small proportion to the whole mass of foreign produce, on account of the deficiency of the means of communication and of transport: but the rapid progress of railroads in every country in Europe, would speedily enlarge the range to which the in- 11 fluence of this trade would extend: a railroad from Hamburgh to Trieste, with its various lateral com¬ munications, would open the produce of the whole of Germany to the first of these great marts of com¬ merce : the ports of the Baltic and of France would he speedily brought by the operation of the same causes, into more immediate communication with the corn growing localities of the vast districts with which they are connected: and it can hardly be conceived that any country will long remain des¬ titute of those great arteries of commerce, which seem destined, more than any other causes, to make distant places near, and to give unity to the agri¬ cultural and commercial interests of all the members of a great empire, however widely separated from each other. The operation of these causes would tend from year to year to make foreign markets less sensitive to the demands of our own, and to bring the range of our prices to a general accordance, after allowing for the cost of importation, with those on the conti¬ nent of Europe and America: in some years the im¬ portation would cease altogether, and it is very pos¬ sible to suppose that the direction of the current of the corn trade would be changed from import to export, though this could rarely take place, since the richest countries are generally those in which the necessaries of life are also the dearest. It is hardly conceivable, however, that foreign nations, under such a state of things, would continue to grow corn 12 to meet the demands of our market, without any reference to the average wants of their own: in other words, the influence of the English corn trade, as far as it possessed any character of regularity, would be, in a few years, almost entirely merged in that of their own markets. Again, it is contended that, under a system of free trade, our capitalists, even if they were not regular com merchants, would be constantly on the watch to avail themselves of every opportunity of making a profitable speculation, and would ransack every market in the world for supplies, whenever a prospect of high prices justified them in doing so; they would thus preclude the possibility of a scarcity of this great necessary of life, and restrain its price always within reasonable hounds. In order to form a just estimate of the value of this argument, we must first endeavour to ascertain at what period of the year we can usually form a correct opinion of the deficiencies of a harvest, so as to make the supply of them the subject of a safe speculation. A rapid change of prices will generally mark the epoch when a decided opinion is first formed of the prospects of a harvest; and if we examine the periods at which those maximum changes have taken place, we shall find that it is rarely before the beginning of September that even an approximate estimate can be formed, or before the end of October that the errors of that estimate can be corrected. The following are the periods of the greatest change of price in wheat in our markets, in one week, from 1829 to 1842 inclusive. 1829 Week ending Sept. 18 from 67s 1 d to 61s 3 d per quarter 1830 „ 10 66 7 , 62 4 1831 Aug. 26 64 3 , 61 9 1832 „ 31 62 0 „ 59 7 1833 Sept. 20 35 0 „ 53 10 „ 1834 „ Aug. 29 48 5 46 5 1833 „ 21 , 42 6 41 1 1836 26 48 10 „ 46 11 1837 Sept. 1 58 2 56 5 1838 „ „ 14 , 70 2 64 2 1839 Aug. 4 , 70 4 , 67 2 1840 Sept. 11 , 68 11 „ 65 4 1841 „ 17 , , 71 2 , 64 8 1842 Aug. 20 , 58 11 , 56 5 The greatest change, therefore, in one week, in the course of the year, generally takes place about the end of August, or the beginning of September, and never at any other season. Its average amount is about 3s 3d per quarter, whilst that which takes place in the first week in September is about 2s; and for other weeks of the year, excluding August and September, not more than 6d. The changes of price, therefore, which are usually gradual and progressive at other seasons, become violent and irregular at this, when the prospects and the results of the harvest are uncertain, and when speculators are at a loss with respect to the course which they can safely and prudently take. 14 The first impressions, however, of the probable productiveness of the harvest which are formed at this season, are still the subject of some degree of doubt and uncertainty, and it is rarely before the aid of October that a very conclusive opinion is formed of its real character. A further examina¬ tion of the weekly returns of the prices of wheat from 1829 to 1842 inclusive, would shew that there is usually a minimum of price (though not always the minimum of the year) at this season of the year, which is in some degree indicative of the existence of a state of doubt and suspense with respect to the future course of the market, which soon after¬ wards generally assumes a more decided character. Years. jWea.odmg. Prices. , Observations. i s. d. 1329 [ Oct. 23 56 4 — 30 55 4 The minimum of the (harvest) Nov 6 55 7 year Dec. 18 57 3 A maximum 1830 Oct. 22 61 6 The minimum of the year: the - 29 61 3 market continued to rise Not. 5 62 3 from this period 1831 Oct. 14 59 11 - 21 - 23 59 2 60 10 The minimum of the year Not. 11 62 7 A maximum 1832 Oct. 12 52 4 - 19 51 3 The minimum of the year — 26 52 7 Dec. 14 54 9 A maximum : the subsequent prices very steady 1833 Oct 18 51 7 — 27 51 4 The minimum of the year Nov. 1 51 7 A maximum : failing prices for the year 15 Years. Weeks endinj Prices. Observations. 1834 Oct. 17 s. d. 41 1 - 24 40 8 A minimum — 31 Nov. 14 41 6 42 6 The maximum of the year Oct. 23 37 0 - 27 36 5 A minimum Nov. 6 — 27 36 7 36 11 1836 Oct. 7 47 2 - 14 47 0 The minimum of the year - 21 Nov. 25 47 7 61 9 A maximum 1837 Oct. 20 51 8 - 27 51 0 The minimum of the year Nov. 3 61 7 - 17 54 4 A maximum 1838 Oct. 12 66 0 - 19 65 7 The minimum of the year — 26 Jan. 11 66 4 81 4 The maximum of the year 1839 Oct. 11 67 2 - 18 65 6 The minimum of the year — 25 Nov. 15 66 5 68 6 A maximum 1840 Oct. 23 62 5 — 30 61 0 A minimum Nov. 6 - 18 62 1 62 2 A maximum By maximum and minimum prices we do not mean necessarily the highest or the lowest prices of the harvest year, but those which are either greater or less than those which both precede and follow them: and it appears that a minimum (which is generally the absolute minimum of the year) con¬ stantly takes place in the last week of October; and a maximum, which is generally the maximum of the winter months, and not of the year, follows at irregular intervals, but most commonly in the 16 second week of November. This remarkable os¬ cillation of prices, occurring nearly at the same season, would seem to point out, not merely the existence of a feeling of uncertainly with respect to the future course of the trade, but likewise the operation of some general cause, which it would be beside our present object to inquire into.* The months of October and November are those, also, in which importations are usually suspended, however great they may be at other periods of the year. It appears, therefore, that no probable opinion of the productiveness of a harvest can be formed be¬ fore the beginning of the month of September, and that the errors of that opinion are not fully corrected before the beginning of the month of November : this is an important element in estimating the course of the operations of a system of free trade in sup¬ plying the deficiencies of a bad harvest. Another, and not less important element of the same estimate, which we shall now proceed to con¬ sider, is the nearly certain effect of a system of free trade upon the bonding or storing of corn. There is everv reason to suppose, that corn would cease to be extensively bonded or stored, in case its importation and distribution was perfectly unre¬ stricted and free. Under the existing laws, com, as is well known, has been extensively bonded in this country, whenever the duties were prohibitory * It may be occasioned by the rash of the poorer farmers to dispose of their wheat, before it is in a state fit for the pnr- poses of the miller. 17 or nearly so, by which means a very large supply has been always at command to meet the deficiencies of our harvest. In the year 1838, after a succession of six years of abundance, there were 900,000 quarters in bond, which were augmented in the month of Sep¬ tember of that year to 1,500,000, the enfranchisement of which tended not a little to moderate the high prices which followed. The ports remained open during the greater part of the year 1839, and little or no corn was bonded; but in September, 1840, we find 800,000 quarters of bonded corn, and nearly the same quantity in the following year, which were .liberated under the same circumstances, and with nearly the same effects. The repetition of the same operation in 1842, when 1,335,000 quarters were forced out of bond, under Sir Robert Peel’s altered corn law, ruined the speculators, and de¬ pressed the market for the whole of the following year; but there is every reason to conclude, that if this system of bonding had not prevailed in the former years of the period referred to, to the extent which we have described, prices would have ranged nearly as high as during some of the worst years of the war. It should be likewise observed, that corn is exten¬ sively bonded in Holland and elsewhere, by English and foreign merchants, on account of the greater cheapness of warehouse-room and labour ; the stores which are thus provided, may be considered as sup¬ plementary to those which are bonded at home, and are always at hand to be thrown upon our market, 18 whenever our ports are open, or the duty sufficiently low. The bonding of wheat and other grain to any great extent may be considered as a peculiar conse¬ quence of our Com Laws: it is the natural, and in some respects the necessary result of the imposi¬ tion of high and sliding duties upon foreign corn. A merchant imports wheat in expectation of sucli a range of prices, as may either make it altogether free, or authorise him in paying the duty: he is disappointed, and the corn, which he cannot other¬ wise advantageously dispose of (for nearly all other countries, America included, have protecting duties), is placed in bond; or an opportunity occurs of buying wheat grown in a locality, such as Poland and Russia, where it is not an article of ordinary consumption, on terms very much below those at which it is selling in England: he imports and bonds it, hoping that the time may come when it may be liberated and sold: thus enabling him to realize the difference, when expenses are deducted, between the lowest price of wheat abroad, and the highest price at home. But there would he no sufficient motive, under a free trade in corn, without a fixed or variable duty, for storing or placing it in bond: for the prices of wheat, after the addition of the expenses of import, would be nearly the same at home and abroad, and there would be no reason for storing foreign corn in preference to that of domestic growth: the pro¬ cess of storing, except for short periods, is always wasteful and expensive: and the merchant who was in possession of wheat, from whatever quarter or on whatever terras obtained, would act more prudently in disposing of it at the market price of the day (which is always the best measure of public opinion with respect to the prospects of the trade), than in placing it in store, at a certain and inevitable loss, and a very uncertain return. Again, how rarely do we find examples of the long continued storing of any great article of produce, unless in the hands of the producer, who cannot easily stop the production without the ruin of his establishment: the iron master is compelled to maintain his furnaces in action, or to blow them out; and being often a great capitalist, and not unwilling to extinguish the rivalry of less wealthy competitors, he perseveres with the certainty of ultimate remu¬ neration : an opulent farmer may store his corn in stack, with much less waste and expense than in a grinary, but he rarely can do so long without very se¬ rious losses: a wealthy merchant may speculate when trade is depressed and prices unnaturally low, on arti¬ cles which may be stored without serious injury or expense, trusting to the return, sooner or later, of prices which may make the investment profitable: but it will rarely happen that merchants and others, who are not entrapped, as it were, into such specu¬ lations, by peculiar circumstances, such as the rapid and unexpected variations of our sliding scale, or the desperate' struggle which is sometimes made to escape from the consequences of a miscalculation 20 of the probable course of a market, will venture upon retaining in store articles of a perishable na¬ ture, with a certain sacrifice of intrinsic though possibly not of marketable value, and with no certain means of calculating upon the period of a return. In confirmation of the opinion which we have expressed, that corn would not be extensively stored, if at all, when the trade was free, we may observe, that no such speculations have been entered into, in our own country, with our own corn, when circum¬ stances were apparently the most favourable to them. At the close of the year 1835, good wheat in Eng¬ land could be bought for 36s. a quarter ; yet no English corn was stored, the price of the day being considered as the most correct measure of the prices which were likely to follow within those limits of time which could authorize such a transaction : and though there may exist a moral conviction in the minds of those persons who have most accurately marked the course of the prices of corn, or of other articles, that there will be a reflux of the tide, yet there will always be so much uncertainty as to the fact of our having reached the lowest point of the ebb, as well as with respect to the progress and character of the succeeding undulatioD, as to make the result of the best organized speculations not merely uncertain but dangerous. It may possibly be urged in opposition to these views, that com is stored at Dantzic and other ports of the Baltic: but it should be observed that the circumstances of those ports are so peculiar, as to 21 exempt them from the general rule : they are the outlets of countries which grow wheat almost exclu¬ sively for foreign consumption: they can only receive it, from the deficiencies of internal communications, at peculiar seasons of the year: the sea through which their shipping must pass is closed during a great part of the winter season: and they are at other times dependent for their trade upon the opening of our ports, or of those of other countries of Europe and America : it becomes absolutely neces¬ sary, therefore, to the very existence of their trade, that corn should be stored, and that frequently in the open air, under circumstances the most wasteful and destructive, and which would he ruinous, if its original cost approached more nearly than it does to the price of exportation. But we may fairly con¬ clude that if our trade was free, little or no corn would continue to he stored at Dantzic or elsewhere, for a longer period than the necessities of the navi¬ gation required: the merchants would no longer wait, as they are now compelled to do, for the irre¬ gular returns of high prices and of open ports in England, but they would at once commit their stores to their fate, in that market which was most accessible at the time, and which offered the most certain and prompt remuneration. Assuming therefore, as we think we are autho¬ rized in doing, that corn, under a free trade, would cease to be stored, except for very short periods, and rather with a view to suit the conveniences of the millers, than for the purposes of mercantile specula- 2‘2 tion, let us endeavour to trace the effects of such a change of system upon prices in years of scarcity. For this purpose, let us suppose that the average quantity of wheat in bond at the approach of har¬ vest, would amount, under the existing laws, to 1,000,000 quarters: in August 1837, it was 743,000 quarters: in September 1838, it was 920,000 quar¬ ters : the ports were open, and bonding in a great measure suspended in 1839 : but in the month of August 1840, 1841, and 1842, it was 787,000, 1,006,000, and 1,339,000 quarters respectively: these quantities will be sufficient to shew, that the estimate which we have made is not very far from the truth. If we assume, in conformity with a supposition which we have made before, that under ordinary circumstances of trade and employment, there will he a difference in the annual consumption of the kingdom of 5,000,000 quarters of wheat, in passing from the extreme average prices of 35s. to 7 5s. per quarter; and further, that the excess above the lowest limit of price, varies in an inverse propor¬ tion to the excess of the provision for the year above the lowest limit of consumption, we should find that the liberation of a million of quarters of bonded corn, would depress the price of wheat by nearly 8s a quarter, a result which is probably not very different from the truth : and it must undoubtedly be consi¬ dered as a special advantage of the existing laws, (though on other points we are by no means prepared -to defend them), that they thus secure, through the operation of bonding, a considerable cheek against high prices, in periods of scarcity, at the same time that they do not tend in years of abundance to depress them further, when they have already touched as low a point as may be considered compatible with the just interests and expectations of the agriculturist. But it may he contended, that whatever advan¬ tages the present Corn Laws may offer, as securing a large provision of bonded corn against seasons of scarcity, they would be more than compensated by the vast resources of our commerce, in case the trade was free : for no sooner would the character of the harvest and the prospects of the trade be ascertained, than every part of the known globe would be promptly laid under contribution for the supply of our wants. But we have before remarked, that it is always late in the year before a correct opinion can be formed of the character of the harvest, and the probable course of the trade: that the same causes which occasion a deficient produce in England, very commonly extend to the whole of the north of Eu¬ rope, from whence our chief supplies are derived: that commercial enterprize can only be stimulated to an extent equal to the emergency of a very serious deficiency in our harvest, by the prospect or the certainty of very high differential prices: that the suddenness and urgency of the demand, would ra¬ pidly raise the freights of our shipping, as well as the prices of corn, at those ports from which supplies were sought to be obtained, whilst those which were ordinarily most accessible to us, might 24 be closed by special ordinances against us : all these causes combined, might operate to confine the supply within the inferior limits of the power of consump¬ tion of the country, and thus expose us to great suffering and distress : and it is hardly necessary to add, that these dangers would be increased in a very alarming degree, if domestic agriculture should be seriously discouraged, and if we should thus be reduced, even in years of abundance, to seek habi¬ tually for any considerable part of our wheat from foreign countries. But it is said, that a free trade would give a certainty and security to speculations in com, which they do not at present possess; and would conse¬ quently authorize operations upon so extensive a scale as would be sufficient to compensate for the inequalities of the seasons: but it should be ob¬ served, that extremely high prices alone would make a trade profitable, which was in its very nature irregular, and for which no regular market could he prepared: that it would be particularly liable to serious losses from miscalculations of the extent of the demand to be supplied, as well as of the efforts which would be made to supply them, and would thus be exposed to many of the same risks as those which arise from the sudden changes of the duty under the existing laws; and there is no sufficient reason to believe, that the wants of our market, when extensive and unforeseen, would be supplied much more rapidly, certainly, and reason¬ ably than they are at present: more particularly 25 when it is considered that the absence of bonding would increase the demand to at least a million of quarters in years of unforeseen scarcity, and to a much greater extent, if free trade should be found to reduce the amount of our domestic produce. The year 1839 furnishes the best approximation which we can refer to of the probable operation of a free trade in corn : the ports were open from the month of September 1838, to the end of the month of October 1839, the prices varying during the whole period, from 66s. to 81s. per quarter, and offering therefore the utmost encouragement for an active and enterprising trade: the whole quantity of wheat which was imported and brought to market, (exclusive of corn which had been previously bonded) during the year referred to was 2,800,000 quarters, which may be considered as a measure of the powers of our commerce, when left to their free and unrestricted action. We are by no means disposed to assert, that such a quantity would represent the utmost limit of our powers of importation, whatever circumstances might call them into action: but we may be very fairly authorized in concluding that it would not be much exceeded, unless under the stimulus, not merely of very high prices in England, but likewise of most abundant provision of corn abroad: a very great difference between them would alone be sufficient to divert to a new and unusual channel, so large a portion of our commercial marine. 26 It is very commonly assumed, that the produce of wheat in Great Britain, is falling every year, more and more behind the necessary supply, and that we shall require continually increasing impor¬ tations to meet the increasing deficiency: or in other words, that the improvements of our agricul¬ ture, neither have been nor are likely to he suffi¬ cient to keep pace with the increase of our popula¬ tion : we believe, however, that this conclusion has no better foundation in fact that many others connected with this subject, which we have already considered. We possess no statistical returns, or other means which enable us to determine with any degree of accuracy, the average annual produce of wheat in this country: but it will not very materially affect our argument, if we should be somewhat mistaken in estimating our annual consumption to be at this time when prices are low, as many quarters as the number of our population. We may likewise very safely assume, that the average individual consumption has been increasing very sensibly during the last quarter of a century : the comforts of nearly all classes have been increased : the lower orders have become more temperate in their habits, and thus have acquired increased means of securing a supply of good and wholesome bread; oat¬ meal and barley meal which were used very largely by the people in the north of England and Scotland, have been very generally replaced by wheat; the poor law unions have distributed most wifely a great part of their relief to paupers, and pauperized families, in wheaten bread and flour, thus increasing not merely its annual consumption, but creating amongst them an habitual want of it as a necessary of life, instead of inferior and less nutritive articles of food. We feel justified by these considerations in assuming, that the annual individual consump¬ tion of wheat has increased during the last quarter of a century at a rate of hot less than ^ per cent, per annum. Again, it is well known that the individual con¬ sumption decreases as the price increases; and we may venture to assume, as we have done before, that a change of Is per bushel, within reasonable limits of value, makes a difference of 5 per cent, in the consumption: thus, if the population and con¬ sumption of Great Britain, when wheat was 40s per quarter, was 20,000,000, a rise of 8s in its price, would diminish the consumption by 1,000,000 quarters : such an estimate can only be considered as an approximation to a very important fact, which forms the basis of all correct reasoning upon the effect of importations upon the range of our prices. The average price of wheat during the de¬ cennial period, from 1821 to 1830, inclusive, was nearly 60 s: its average price during a second decennial period, from 1831 to 1840, inclusive, was about 56s: for the quinquennial period, 28 from 1841 to 1845, inclusive, it may be assumed to be 52s; the importations (including those from Ireland) may be taken, during the first period, at 1,000,000, during the second at 1,500,000, and during the third at 1,750,000 quarters per annum : the seed, and wheat consumed in manufactories, distilleries, and feeding of cattle, may be reckoned at (though upon very imperfect data) |th of the consumption: the population increasing at 1 ^ per cent, per annum, would be 15,500,000 in 1825, 17,700,000 in 1835, and 20,000,000 in 1845 : and if we assume the annual individual consumption, when wheat is at 40s per quarter, to be 1 quarter at this time, it would have been feths of a quarter under the same circumstances in 1825, and -JSths of a quarter in 1835 : we shall now proceed to apply these assumptions, which are very probably not far from the truth, to calculate the entire produce of the wheat crop of Great Britain in 1825, 1835, and 1845. 182-5.—The Population . . 15,500,000 The decennial average price of wheat from 1821 to 1830 . . 60 S The consumption for food . 12,600,000 „ for other purposes 2,520,000 15,120,000 Irish and foreign importations . 1,000,000 The total produce . . 14,l20,t)u0 i.—The population 17,700,000 The decennial average price of wheat from 1831 to 1840 56s The consumption for food 15,000,000 „ for other purposes 3,000,000 18,000,000 Irish and foreign importations 1,500,000 The total produce . . 16,500,000 . -The population 20,000,000 The quinquennial average price of wheat from 1841 to 1845 . 52s The consumption for food 18,500,000 „ for other purposes 3,700,0(10 22,200,000 Irish and foreign importations 1,750,000 The total produce . . 20,450,000 If the produce of wheat had merely increased in the same proportion with the population, its amount in 1845 would have been 18,200,000 quarters only: it would appear, therefore, that the resources of our domestic agriculture alone would be com¬ petent to feed 2,000,000 persons beyond our present population, upon the same terms as in 1825. Nor are the resources of our agriculture likely to be soon exhausted, or to prove unequal to the addi¬ tional demands which may be made upon them: at no period have the improvements in the cultivation of arable lands made such rapid advances as during the last eight years: all the powers of chemical science hare been brought to bear upon the compo¬ sition and proper application of manures: the islands of the Pacific and Southern Oceans have been ran¬ sacked in the search for new stimulants of production: drainage upon new and improved principles is likely to increase considerably the produce of our heavy lands, whilst superior modes of cropping and artificial manures have been equally beneficial to our lighter soils. There is every reason to conclude, therefore, if the progress of agricultural improvement be not checked by discouragement, that our produce will continue to increase, as hitherto, more rapidly than our population, and thus materially to reduce the cost, even without the aid of foreign importations, of the most important of the necessaries of life. It has been objected to the present Corn Laws, that they have failed to accomplish the objects pro¬ posed by their framers, in securing such prices as they considered essential to the interests of agricul¬ ture : the prices contemplated have not only not been maintained, but have continued to fall ever since the termination of the war. The proper inter¬ pretation of such a fact would appear to be, that the Corn Laws, though they happily had not an¬ swered the expectations of their authors, had fully- secured the interests of the consumers, inasmuch as the productive powers of the land have increased, and the prices of all the great necessaries of life have 31 fallen, either in consequence or in defiance .of their operation. But whilst these facts are admitted, it may be contended that the same effects would have been produced in a still greater degree by a free trade in corn: in the absence, however, of all satisfactory proof, whether from reasoning or from its effects in other countries, that such conse¬ quences would certainly follow from it, we may be content to claim the experience of the operation of the existing laws, as more favourable to the views of their defenders, than of those who are anxious for their repeal. We have before attempted to shew, in oppo¬ sition to opinions pronounced with great confi¬ dence, both in and out of Parliament, that the existing laws do not tend to produce rapid and unnatural variations in the prices of the first of the necessaries of life, but rather to give them a steadi¬ ness and regularity which a system of free trade would fail to secure: we shall now proceed to refer, in farther confirmation of this view, to the relative variations of the prices of wheat in England, and in such markets in America and Europe as may be considered the least likely to be influenced by the disturbing effects of our Corn Laws. The highest and lowest weekly prices of wheat per imperial quarter in Philadelphia, from the years 1834 to 1840 inclusive* * Parliamentary Papers for 1841, vol. vii. Return moved for hy Mr. Gladstone. Year. Highest. 1834 40s 0 d 1835 50 10 1836 75 8 1837 75 6 1838 62 4 1839 59 7 1840 37 7 Lowest. Diff. per ( 35s 0 d 14 34 5 47 42 10 78 53 7 41 44 9 39 34 8 73 28 0 34 The highest and lowest weekly prices of wheat per imperial quarter in period. Year. Highest. 1834 49s 2 d 1835 . 44 0 1836 61 9 1837 60 1 1838 78 4 1839 81 6 1840 72 10 igland, during the same Lowest. Diff. per < 40s 8 d 21 36 0 22 36 0 71 51 0 18 52 4 49 65 8 24 58 10 24 It should be observed, that Philadelphia is the capital of one of the wealthiest and most populous states of the American Union, which does not com¬ monly produce sufficient corn for the supply of its inhabitants : that little or no corn or flour was im¬ ported from America into England during the first five years of this period, and that the importation in 1839 and 1840, tended to raise the low prices of those years, and to diminish therefore the extreme limits of their fluctuation: that it is a great mart of commerce, communicating freely with every region 33 28 i of the world: that its com trade is free, being merely subject to an import duty of 8s 8 d a quarter. These circumstances are sufficient to shew that few localities and few periods could be selected, which would be less influenced by the operation of our Com Laws, and where prices in a commercial and importing country, would appear to exhibit more completely the fluctuations which were due to natural and uncontrollable causes alone: yet we find the average annual difference between the highest and lowest prices in Philadelphia is 47 per cent, whilst during the corresponding period in England it was only 33: and whilst the extreme difference between the highest and lowest prices of wheat in this septenniaTperiod was 270 per cent, in Philadelphia, it was only'227 per cent, in England: and it should he further observed, that no septennial period could have been chosen, which would have exhibited, under the operation of our Corn Laws, such exten¬ sive fluctuations of price. The returns of the prices of com at Portsmouth in New Hampshire, New York, New Orleans, and other American towns, lead nearly to the same con¬ clusions as those of Philadelphia. . But it may he objected, that we have dealt with the extreme weekly prices of wheat at Philadelphia, which may have been exaggerated by local and pe¬ culiar causes: we shall proceed, therefore, to apply the same comparison to the average annual prices 34 of the same place with those of England, from 1830 to 1833 inclusive.* Tear. Philadelphia. England. 1830 33s Od 64s 0 d 1331 41 0 66 0 1832 42 0 59 0 1833 41 0 53 0 1834 37 0 46 0 1835 43 0 39 0 1836 61 0 48 0 1837 73 0 56 0 1838 59 0* 65 0 The difference between the highest and lowest annual price of wheat at Philadelphia, amounts to 121 percent.: whilst the corresponding difference in England, daring the same period, is only 69 per cent. Similar facts are observable in the prices of the agricultural produce of nearly every country in Eu¬ rope, but their authority is lessened by the alleged action of our Com Laws in disturbing the course of the trade, producing very high prices when our ports are open, and depressing them unduly when they are closed: but if we should grant the full effect of these causes with respect to wheat and such other grain as is commonly imported intoEng- * The return (Parliamentary papers, 1842, vol. 40, p. 601) is given in the prices of barrels of flour, which we have re¬ duced into quarters of wheat, by allowing 4 bushels per barrel, and deducting 4s per barrel (as is usual), for the expenses of the miller. land, they will not apply to rye, which is rarely if ever imported, and which constitutes the staple article of food of the peasantry of Russia, Poland, and the north of Germany. Let us take the highest and lowest prices of rye at Warsaw, from the years 1834 to 1839 inclusive. Years. Highest. 1834 22s 6 d 1835 22 0 1836 12 8 1837 24 9 1838 24 4 1839 15 0 15s 0 d 30 9 10 120 8 6 49 10 0 149 16 6 53 10 0 50 If we pass from Warsaw to its sea port Dantzic, though the communication between them is diffi¬ cult and irregular, we shall find these differences, though modified hy the operations of commerce, and by the habits of a mixed and mercantile popu¬ lation, still more considerable than in the prices of wheat in Great Britain. Years. Highest 1834 20s 6d 1835 23 8 1836 15 9 1837 13 2 1838 26 11 1839 26 9 14s 6 d 15 2 12 8 20 0 22 0 15 7 Diff. per cent. 21 65 In Prussia, during the same period, the fluctua¬ tions of the price of rye exceeded 100 per cent, and we believe that, at this season, which is one of great scarcity throughout the North of Europe, the price of rye is nearly 40s. a quarter: the people, who export their wheat, are dying of famine. In a report addressed to the Russian Govern¬ ment from the province of Tamboff, it is stated that the price of rye in years of abundance varies from 3s 11 d to os 2fd per quarter; in ordinary years from 6s 6f d to 9s 2d : whilst in a year of extreme scarcity, (1833) it rose to 36s 8d : so ex¬ traordinary are the natural variations of the sea- The facts, however, which we have mentioned, are sufficient to shew that in wealthy countries as well as poor, even where they have all the resources of commerce and of free trade at their command, the variations of the price of the necessaries of life are more considerable than under the operation of our present laws. Admitting therefore that under a system of free trade, no considerable provision would be made against a deficient harvest in the form of corn in bond or in store, and that no means exist before the months of August or September, of forming a judgment of the productiveness of the harvest, and of the deficiency which must be supplied by impor¬ tation, we may very safely conclude that the trade which would thence arise, would always be im¬ pulsive and irregular: it would not be conducted through the accustomed channels of commerce: it would not be adjusted to any systematic reciproca¬ tion of exports and imports; it would be a hazard- ous trade to all engaged in it, as defying all correct anticipations as well of the extent of the demand, as of the efforts which would be made to meet it: its suddenness and irregularity would tend to make it, at least as much as under the operation of the existing law, a bullion trade, and such as would tend to derange very materially the monetary system of this country. It is this derangement of the currency which has always been urged as one of the principal objections to the existing law; but it is obvious, for the reasons which we have already assigned, that it is a necessary consequence of every trade which arises suddenly, after irregular and sometimes considerable periods of suspension, and which is necessarily more or less diverted from the great marts of commerce: and whatever may be the amount of evil which it now produces, it would necessarily he greatly increased by a free trade in corn: for the operations of such a trade, if no extensive provision against the inequali¬ ties of the productiveness of different seasons, was made by bonding or storing, would he of the same character as under the existing law, and upon a much more extensive scale: and there is no reason whatever for supposing that the exportation of bullion which it would require, would not increase nearly in the same proportion as with the increase of the trade. In all arguments on the policy of a fundamental change of our Corn Laws, a reference is generally 38 made to our commercial relations with America. It is contended that it is essential to the highest interests of this kingdom to cultivate the utmost freedom of intercourse with that great country: that the liberality of the provisions of their tariff is likely to respond to those of our own : that Ame¬ rica would freely exchange her corn and provisions with the productions of our manufactures, and that it would possess the advantage of being carried through the usual channels of trade with a less expenditure of bullion than with countries with which we have little or no trade, or which repel it by hostile tariffs. Whilst we admit the general truth of this argument, it should at the same time he observed, that in many cases, w r hen a trade in com should arise from a failure of our harvests, America would not he in a condition to supply it. The price of wheat was as high in America in the years 1836, 1837, and 1838, as in the dearest seasons in England: the seaboard states do not supply com sufficient for their own inhabitants, and though their population is increasing, at least in the towns, there is no improvement in their agriculture: large tracts of exhausted soils in Penn¬ sylvania and Virginia have been abandoned, as not defraying the expenses of cultivation ; and though in the more recently settled states, the virgin soil teems with produce, and supplies, not merely the older states, hut Brazil, the West Indies, and Europe, yet it should be kept in mind, that their 38 39 population is rapidly increasing, whilst the fertility of their soils is not renewed by the careful and laborious culture of Europe: that the movement of population as well as of production is from the East to the West, removing them year by year farther from the eastern states, through which we must always obtain our supplies. There is therefore a prospect of an increase, rather than a decline, of the prices of corn and provisions in America: and whilst the general range of prices in that continent, when those in England are moderate, are at present too high to make a trade in corn profitable, the con¬ tingency of the concurrence of their years of abun¬ dance with ours of scarcity, would be much too rare and too irregular in its period, to make the opening of our trade in corn and provisions, a subject of such great and permanent national importance, as to he likely to exercise a lasting or material influence upon the character of their tariff; it would he to the neighbouring ports of France, Belgium, Holland, Germany, and the Baltic, and not to those on the farther shores of the Atlantic, that we should, in most cases, resort for our supplies.* We have endeavoured, in the preceding obser¬ vations, to prove that many of the most popular of the arguments which are advanced against the operation of our present Corn Laws are unfounded * The importations of wheat and flour from America, has not amounted, during the last 20 years, to 1-10 th part of those from the continent of Europe. 40 or exaggerated: that a free trade in corn would not produce a safe or regular trade: that it would present no additional security for the supply of our wants in seasons of scarcity: that it would rather increase than diminish the extreme range of fluctua¬ tions of prices : that it would prevent the extensive bonding or storing of corn: that it would tend to increase the derangements of our monetary system, which are occasioned under the present law by sudden and large importations of com. But we trust, that in attempting to vindicate the existing law from producing effects for which it is not charge¬ able, we are not blind to its real defects,—one or two of the more obvious of which we shall now proceed very briefly to notice. It tends to mask the real relation which exists between the natural range of prices on the continent and in England, and it thus becomes liable to much misrepresentation and odium, as augmenting unduly the price of the most important of the necessaries of life. We possess no means of estimating with any de¬ gree of correctness the probable effects of a free trade in com upon the range of its prices in Eng¬ land, more particularly at the lower points of the scale. Very plausible arguments may be produced to shew that the average price of wheat, in years of abundance, would descend as low as 30s a quarter, whilst others, not much less so, would make the probable depression altogether inconsiderable. 41 Some assert, that a free trade in corn, aided by our vast capital and commerce, would give stability to prices, and restrain them, in all seasons, within moderate limits of fluctuation: whilst others are equally ready to maintain, and we reckon ourselves amongst their number, that it would tend to enlarge those limits considerably: and whilst the friends and opponents of a free trade equally admit that it will tend to equalize prices at home and abroad, the greatest discrepancy of opinion prevails with respect to the mode in which they will approach each other: will the range of foreign prices rise to our standard, or will ours be depressed to theirs ? or at what intermediate point will they meet ? The impossibility of answering these different questions with any degree of certainty, in the present state of our knowledge of the resources or prospects of foreign agriculture, or even of our own, leaves an open field for the most harassing agitation: and whilst one party stigmatizes the existing laws as op¬ posed to the freedom of commerce, and as singularly oppressive to the poor, by increasing exorbitantly the cost of the necessaries of life, the other appeals to them as our only safeguard against the inevitable ruin of the most important interest in the empire. The mere removal of this uncertainty, so injurious to the internal peace and tranquillity of this king¬ dom, would be a sufficient motive to encourage a wise and prudent statesman, to adopt any course, which the state of public opinion left open to him. which might, if possible, solve this great and im¬ portant problem, without, at the same time, com¬ promising or appearing to compromise, those great interests, and, we may add likewise, those well founded claims and expectations which have sprung up under the long continued sanction of the legis¬ lature. Again, it is objected to these laws, that they im¬ pose restrictions upon the freedom of commerce, less for the purposes of the revenue, than for the pro¬ tection of agriculture. The defence of the exemption of corn from the laws which regulate the imports of other articles, upon which fixed, though sometimes discriminating duties are imposed, must always rest on grounds which, however good and well founded they may be, are not easily understood, and far from being gene¬ rally admitted: it is extremely difficult, therefore, to exempt them from the odium which is attached to all acts of legislation, which appear, at their first aspect, to regard rather the interests of classes, and particularly of the higher classes, than those of the great mass of the population : if the duties on corn were either fixed, or more obviously imposed for the purposes of revenue, and if they afforded a protec¬ tion not greater than that given to other productions of native industry, they would be regarded as arising naturally out of the necessities of the revenue, and thus experience a more willing and general acqui¬ escence : thus, if the duties generally, which serve 43 the double purpose of protection and of revenue, ■were 10 per cent., (which seems to he the basis which it is proposed to adopt in all other cases), the duties on wheat would be about 5s 6d, on barley 3s 8d, and on oats Qs 3d per quarter: if we should reduce these duties to 5s, 3s, and *2s respectively, they would materially aid the revenue, without se¬ riously increasing the cost of the consumer: the effect of such a duty on the average price of wheat is a question of great interest, particularly at the present moment, and we shall now proceed to con¬ sider it. If the importation of 500,000 quarters of wheat would depress prices in England to the extent of 4s. a quarter, and raise them abroad Is. a quarter, then 4s. would be the extreme limit of the increase of price which such a duty would occasion ; if a greater influence upon prices abroad was attributed to English importations (as is very commonly supposed), then the limit of the increase of price, produced by such a duty, would he still further reduced; but its average effect upon prices would be in reality much less than this. There are at present nearly three years out of five when our domestic produce is fully equal to our consumption : and we may fairly assume,—allowing for the increased consumption which diminished prices would occasion, and sup¬ posing the wages and employment of labour to remain unaltered (though it is certain that in many cases they would necessarily be diminished), that 44 there would be two years out of five, even if there was no duty whatever, in which no impor¬ tation would be necessary, or in which even the direction of the current of trade might be reversed: this would reduce the average effect of the duty in a quinquennial period, from is. to less than 2s. 5d. But there are other causes in operation which would reduce this average effect still farther: if a sudden scarcity (and the emergency of a deficient harvest, as we have elsewhere shewn, is always sudden), should make prices rise rapidly above the range of foreign markets, and thus produce the powerful impulse which is absolutely necessary to put the machinery for a large importation in motion, then the prices in those markets would be dragged up towards the level of ours, and the influx of wheat would continue, though not with the same rapidity, whether the difference of foreign and domestic prices (the charges of import being deducted), was 6s. 10s. or 15s., leaving the motive forces of importation when the duty was deducted (if we may use such a phrase) Is; or 5s. or 10s. respectively. As long therefore as the difference of prices consi¬ derably exceeded the duty, it would add very slightly to the cost of the imported wheat, inasmuch as it would only influence the rapidity of the importa¬ tion : it would only be when the prices approached the point of equilibrium, (or that at which they differed by the duty only) that the duty would totally check the importation, and its influence would be felt 45 in thepermanent position to which our prices would begin to approach: and even if this point of equili¬ brium had been once attained, if the rise of foreign markets was entirely due to the extent of our de¬ mand, and not likewise to that which might arise from the wants of other countries, they would con¬ tinue to fall with the fall of our prices, until they had attained a general and permanent equilibrium: and it would only be at this point in the descending scale of prices, that the whole effect of the duty would be experienced. It is not easy to estimate the entire effect of this merger of a moderate duty in a sudden rise of prices considerably exceeding it in amount, (and a conside¬ rable rise of prices would rarely take place without it); hut it is not unreasonable to suppose that it would at least reduce the average difference of 2s 5d, which we have already considered, to less than 2s, which we may safely adopt as the ex¬ treme limit of the increase which the average price of wheat, in a period of years, would experience from the imposition of such a duty, If a fixed import duty of 5s was combined with a fixed drawback of the same amount upon expor¬ tation, without distinction of origin, whether do¬ mestic or foreign (in conformity with the recom¬ mendations of Mr. Ricardo and Mr. M'Culloch,) it would greatly relieve our agriculture in years of abundance, by encouraging exportation, and would not, upon a balance of a series of years, greatly di- 46 minish the productiveness of the duty, which would always depend upon the excess of the imports above the exports: such a measure would tend much more than a total abolition of duty to make the corn trade of other nations pass through the ports of this country, and also to secure an amount of supplies (as bonding would probably he extensively practised upon such a system, though not for long periods) in seasons of scarcity; it would secure the agricul¬ turist against ruinously low prices, which a plethora of unexportable produce sometimes occasions: it would make the com trade, though not a regular trade, an important branch of commerce in all seasons, and which, in an average of years, would contribute its just share to relieve the financial bur¬ dens of the country, without any serious or unrea¬ sonable addition to the prices of the necessaries of life. There are many other objections which may be reasonably urged against our sliding scale of duties, but as they very slightly affect the general tenor of our argument, we shall not proceed to notice them. THE END.