Part 12

The wonder cannot but increase, if we consider with what eagerness those two countries are intent upon improving their trade.

The wonder will still increase, when it is observed, that the French carry to the highest pitch their rage for English modes, whilst the English experience the same kind of frenzy for French fashions.

The wonder must increase still further, when it is observed, that the same nations, in possession of the most active and most intelligent industry, are also possessed of all the cash necessary to give an additional activity to that industry, which might be required to carry on a branch of trade, as it were, at their door, but which is neglected, out of regard for old and absurd prejudices.

Still must the wonder increase, if it is observed, that a first capital of 200,000l. laid out in that trade by the two nations, would occasion in both, more work in cultivation, as well as in the arts, than 600,000l. which each of them might employ in a trade to China, if it were possible to lay out such a sum upon it?

The wonder will be still greater, when we consider that, by favouring, with equal care, the imports and exports to and from one country into the other, the two nations would, without the least inconvenience, acquire the means of increasing the revenue of their customs respectively, according to their wants, by agreeing mutually upon a tarif, which would be rated upon the average of those wants; a tarif, which the rest of Europe might adapt to its circumstances, if it were the general intention to increase, every where, the revenue of the State and the industry of the people, in a like proportion.

This is certainly what the two nations might have compassed. That which follows, is what they have done.

In the year 1699 the exports of England to France amounted to 287,050l. and her imports from France to 94,641l:—

In 1773, the period at which Sir Charles Whitworth closes his statements, the exports from England were rated at 285,776l. and the imports from France at only 44,484l.—On this the enthusiastic admirers of the Balance in favour bless their stars that their country imports now 50,157l. less in French goods, than it did in 1699, and that, in order to secure this advantage, England experiences no other damage than that the French are fallen in their imports from England only 1274l. since the year 1699.

Further Reasons why all Ideas of a favourable Balance in Money, different from that which I have supposed, should be rejected.

Great-Britain is not the only nation that claims a right to that kind of favour, which would reduce all Europe, in all transactions, to the use of paper-money; but I only speak of England in this place.

Money is not hid under ground in a country where administration is convinced, both of the impossibility of the people paying exorbitant taxes, without proportionable riches, and of the impossibility of being as rich as is requisite for the discharge of enormous taxes, when individuals are compelled to appear less rich, that they may be less burdened with imposts.

Money is not laid under ground in a country, where the smallest sum, as it were, equally with the largest, may be placed most securely, till the very moment, when, led by fancy or want, one may think well to withdraw it, and which, from the time when it has been placed, to that of recalling it, produces nevertheless a sure interest, which never was delayed a single minute; an interest, which is a matter neither of reproach nor of shame.

Money is not laid under ground in a country, where the reputation of being rich exposes not the subject to an arbitrary taxation, nor to demands equally ruinous, to informations, extortions, or at least to some injustice in case of a refusal.

Money is not laid under ground in a country, where regard is the appendage not only of wealth, but of credit also, which carries the appearance of, and can procure the former.

Nor is money hid under ground in a country, where it shews the value of a man as positively as that of a piece of goods; in a country, where it is frankly said, this man is worth a million; whether this expression be made use of to signify that the possessor of a million is, at least, by the whole extent of that million, far from being guilty of meanness and injustice, or that it be understood that nothing but the offer of another million could tempt him to commit anything base or unjust. Money is never buried under ground in a country, where it acts so essential a part; it cannot then be its fate in England: all the money in the possession of England stands in full evidence; it consists,—1st, in objects of private luxury, the quantity of which is by no means extravagant;—2dly, in the mass of cash in circulation. Now this very mass is despotically determined by the number of affairs transacted, and likewise by the prices and quantity of the property which is to be circulated; yet this mass is, perhaps, in England one half less than it would prove any where else, supposing the same objects to be attained; that universal mobile is too justly appreciated there, to be lavished, that is to say, to be turned into cash, beyond what is required to give credit to the paper currency substituted to cash.

I shall therefore ask, In what public funds abroad the English merchants vest annually the four or five millions of that pretended favourable balance in money, since they do not bury it at home?—There might, it is true, still exist another resource; the general balance is only the aggregate of all private balances.⸺But is it very certain that, upon an average, the private balances of all the merchants in Europe, who correspond with England, are annually charged by one fourth of the amount accruing from that correspondence? For if the English send them 16 every year, and every year import only 12, their correspondents are consequently indebted to them annually 4 more than they were the preceding year.

The favourable balance, as it is commonly understood, is then a mere chimera, which, if realised, would produce no other effect than to advance, at some period or other, the price of a pound of bread to that of a pound weight of gold; yet it results, methinks, from the exports of England, almost trebled within a century, that each nation, with whom the former has trebled her trade, has increased her own, at least, by the whole amount of the balance due by her to England; for it is beyond a doubt, that one must have three times more to sell, in order to be able to purchase constantly, and pay three times more than he used to do. But from this principle may it not be inferred also, that every nation, wishing to increase her trade, is interested in an increase of the commerce of all those with whom she means to correspond?—If, in order to reduce into practice, if to establish on the most equitable and most solid foundation, a system so truly advantageous to society, Nature had nothing more to combat than private cupidities—they balance each other. But how many national prejudices, how many maxims sacred to each nation, how many absurd regulations, springing from those very maxims and prejudices, is she not obliged to modify, as it were, underhand, in their effects! What a number of smugglers does that good mother employ, for the purpose of bringing all things nearer to that equilibrium, from which many are still persuaded it is so very material to deviate!

Equilibrium necessary in all things.—On the surest means of establishing it.

It is a difficult matter to guard against a prejudice in favour of liberty, when we consider, that, thanks to the freedom which has always very generally prevailed in those parts of Science, wherein policy disdained to restrain it, we have been taught to weigh air, before any precise idea was obtained on the rule of proportion, which ought to regulate matters of exchange. Every thing, in this last particular, is even still merely mechanical; and perhaps if the matter were thoroughly examined, it would be found that there is never too much, nor too little in one of the scales of the balance, but from an effect of the means devised to establish or preserve the Equilibrium. I do not pretend to lay down, for an absolute principle, that the hand of man, like that of the harpies, is only capable of poisoning whatever comes within its reach, and that the wisest conduct would be, to keep it with care from every thing that one should wish to preserve from corruption; such a proposition would, no doubt, prove rather too general; yet one cannot help observing, that there are but few countries where administration has not often, owing to the grossest ignorance, or some principle of injustice, or of a cupidity almost equally blind, restrained some very lucrative cultures, to which the nature of the soil and of the climate would have given a perfection that could be attained no where else; or have not encouraged some costly produce, to which Nature refuses those qualities which she liberally bestows under another sky.

Neither can one refrain from remarking also, that from those regulations, and from many more of the same kind relative to manufactories, no other effect can result than that of buying up at home, very dear, and often of a bad or indifferent quality, that which might be purchased abroad of an excellent kind, and at a cheaper rate, and which might be paid for with the productions of the earth and industry, better suited to the climate of the purchaser.

It is also observed, that, without the interference of administration or of philosophy, the balance between want and the relative quantity of the different productions of the earth, is always, upon a medium, admirably supported by the sole interest of the cultivator, ever perfectly and solely guided by the common demand for each of these productions.

It is also remarked, that a second balance, and a very necessary one, between the mean price of those different productions, is also mechanically established, on the difference of labour and of the capitals, which the same cultivator lays out upon each of them, without any other motive but that of employing with discernment, his hands and his capital, to derive from them the greatest benefit. He never thinks of restoring the equilibrium between the general prices, when the price of the product A has fallen, and when a continued advance on the product B invites him to multiply the latter, by transferring to its cultivation, a more considerable share of his labour and of his capital. Nor does he think of it, when laying out new supplies of labour and money if the price of the product B keeps up whilst that of the product A goes on increasing; he does not think of it; and yet, without any other reason or motive than his own interest, he restores that necessary equilibrium. Much less still does he think that an increase maintained in the price of one object, without diminution in that of other articles, bespeaks an increase of the general consumption, which soon must raise the price of every thing. Nay, it is very probable that he will not take notice that he sells all his goods at a higher rate, and that he will soon complain of the general advance in the price of all those which he buys, because his interest is his only guide: but this interest is opposed by that of industry; and from this clashing, in spite of the two opponents, arises a new balance, more loaded, no doubt, than the first, but not less necessary, not less equitable, and yet no one has meddled with it.

All these things may be easily observed; but what ought to be more particularly attended to, and what is most overlooked, is the impossibility of ascertaining the difference between the hand-labour and capitals to which we owe the productions of the earth, the knowledge of which is within the reach of every one, and the labour and capitals to which we owe the productions of industry, in which the workmanship of an article often constitutes the half, and sometimes 99 hundredths of its value: it is a disadvantage against which agriculture cannot be effectually protected but by a competition, which can be the result only of the greatest freedom. The absolute passiveness, which, in the above stated circumstances, is sufficient, on the part of Government, to effect the greatest good, appears here indispensable, to avoid acts of injustice. Why should the trading part complain of that passiveness, whilst a number of cultivators, proportioned to that of the artisans, produce in the State a revenue equal to the maintenance and support of industry? Now the fact appears the more certain, as, upon the least reflexion, one may be sensible, that if an epidemic disorder should break out amongst the husbandmen only, and thus deprive cultivation of one half of its proper number of hands, the survivors would not fail to increase the price of their labour, and the farmer that of his farm, by so much as would indemnify agriculture for the loss which she might have sustained, and that the advance in her prices would fall off only in proportion as the handicraftsmen without employment, by the uselessness of that portion of the produce of industry, hitherto consumed by the cultivators who fell victims to the disease, would themselves turn cultivators; an operation which would soon restore the proper balance between the two revenues, as well as between the prices of labour, from which all kinds of produce originate. Let the effects of the disease be transferred from the cultivators to the handicraftsmen, the same manœuvre will be played off by those who preside over industry.

Should another reason be wanted to strengthen my argument in its most essential part, I could adduce an incontestable fact, as little controverted in France as it is in England, namely, that in both countries the whole of the landed property does not yield three fourths of what it ought to produce.—Then, either the respective industry of the two nations ransoms agriculture, and binds her up, without being suspected of doing so, to that state of mediocrity to which she is reduced; in which case, single out of your regulations, those which favour industry at the expence of cultivation, and endeavour to expunge them, since agriculture stands clearly in want both of hands and capitals; or your industry and agriculture are neither of them nearly arrived to that degree of perfection which they are calculated to reach; that is to say, you have not the number of cultivators which your land can nourish, nor of course, so many artificers as your land can maintain; in this case also, revise your regulations; there is not one of them which does not affect your agriculture in a direct or indirect manner; by her you must begin: cultivators, unthinkingly and without regret, give birth to a race of artisans;—it is, on the contrary, as it were in spite of industry, and by a kind of reaction which she spares no endeavours to retard, that cultivators are produced by artisans. Never will industry lay out a shilling upon the land if she can employ it in any other enterprise.

But, would the inland trade, without which agriculture cannot subsist, flourish, if foreign commerce should not be encouraged in a particular manner? And were any circumstances whatever, combined together so as to occasion such an alteration in the price of necessaries, as would deprive industry of the proper means to support abroad a competition which cannot possibly subsist but by an equality of means; would it not then become necessary for government, to shew a special favour to commerce, intrusted with the care of that competition? The manufacturers, in all countries, insist so forcibly on such a necessity! The ruling powers in every nation are so convinced of the truth of the above maxim!

This question, truly important, requires some details on the different causes productive of the alteration in the prices.

Although I may often appear, in the following suppositions, to lose sight of the revenue arising from industry, and pay attention to that of the land only, we must not forget the mechanical principle, or rather the force of Nature, who, sooner or later, in spite of all the subtilty of man, keeps an exact balance between those two sources of national wealth, and causes all the revolutions of the one to be unavoidably felt by the other.

Various Causes of the Alteration in the Prices.