E VE R Y M A N S L I B R A R Y

E D ITE D B Y E RN E ST R H YS

SC I EN C E

THE W EA L T H OF N ATI O N S
WI T H AN I N T RO D U CT I O N BY

P RO F . E D WI N R A S EL I G M A N
. .

VO L . TWO
TR A VE L 3 SCI E N CE 3 F I C TI ON
THEO LO GY 8: P H I L O S O PHY
HI ST O R Y 3 C L AS SI C A L

F OR Y O UNG PE O P L E

E S S AY S 3 O R A T O RY

P O E T R Y 8 D RA M A
c

BI O G RA PHY

ROM ANCE
 CONTENTS
B OOK I V —C o n t in u ed
.

CH AP .

I V Of Dra w
. b k ac s

V . O f B o un t i
es

VI . O f Tr ea t i es of Co m mer c e

VI I . Of C l i
o o n es

VI I I . Co n c l ius o n o f t he Mer c an t ile S y st em

IX . Of t h e Ag i r c ul t ur a l Sy st e ms ,
or o f t h o se S y st e li t i l
ms of Po ca

Ec o n o my wh i h p t c re resen t he Pro d u ce o f L d it h
an as e er

t he l t h p i ip l S
so e o r e r nc a o ur ce o f t he Re v d W lt h
en ue a n ea

of e v yC ty
er o un r

B OO K V
OF TH E RE VE N U E OF TH E S O VE R E I G N OR CO MM ON WE ALT H

I . Of the E xp en s es o f t he S o v ig
ere n or Co mmo n w e a t lh
II . O f t he S o ur c es of t he G en er a l P bli or u c Re v en u e o f t he S o c i ty
e 29 8

III . O f Publi D b t
c e s

App di x
en
4 31
I d x
n e
 A N I N QU I R Y
I NTO THE

N A T U RE A N D CA U S ES OF THE

W EA L T H OF N A TI O N S

BOOK IV — Co7zt zn u d
.
°

CHAPTER IV
O F DR AW AC KS B

M E RC HANTS and manufacturers are not contented with the

monopoly o f the home market but desire likewise the most
,

extensive foreign sale for their goods Their country has no .

jurisdiction in foreign nations and therefore can seldom procure

,

them any monopoly there They are generally obliged there

.
,

fore to content themselves with petitioning for certain en

,

c o u ag
r emen t s t o exportation .

O f these encouragements what are called Drawbacks seem to

be the most reasonable To allow the merchant to draw back
.

upon exportation either the whole o a part of whatever excise

,
r

o
r inland duty is imposed upon domestic industry can never ,

occasion the exportation o f a greater quantity of goods than

what would have been exported had no duty been imposed .

Such encouragements do not tend to turn towards any parti

c ular employment a greater share o f the capital of the ountry c

than what would go to that employment o f its o w a ord but n cc ,

only to hinder the duty from driving away any part of that
share to other employments They tend not to overturn that
.

balance which naturally establishes itself among all the various

employments o f the society ; but to hinder it from being over
t urned by the duty . They tend not to destroy but to preserv e ,

what it is in most cases advantageous to preserve the natural ,

division and distribution o f labour in the society .

The same thin g may be said o f the drawba ks upon the e c r

exportation of foreign goods imported which in Great Britain ,

II
H8 A 2

Ho ]
. S (n
2 T he W e al t h of N at i o n s
generally amount to by much the largest part of the duty upon
importation By the second of the rules annexed to the act of
.

parliament which imposed what is n o w called the o ld subsidy ,

every merchant whether English o r alien was allowed to draw

, ,

back half that du t y upon exportation ; the English merchant ,

provided the exportation took plac e within twelve months ;

the alien provided it took place within nine months Wines
,
.
,

currants and wrought silks were the only goods which did o t
,
n

fall within this rule having other and more advantageous ,

allowances The duties imposed by this act o f parliament were

.

at that time the only duties upon the importation o f foreign

goods The term within which this and all other drawbacks
.

could be claimed was afterwards (by 7 Geo I chap sect 0) . . . 21, . 1

extended to three years .

The duties which have been imposed since the Old subsidy
are the greater part of them wholly drawn back upon exporta
, ,

tion This general r ule however is liable to a great number o f

.
, ,

exceptions and the doctrine of drawbacks has become a much

,

less simple matter than it was at their first institution .

Upon the exportation o f some foreign goods o f which it was ,

expected that the importation would greatly exceed what was

necessary fo the home consumption the whole duties are drawn
r ,

back without retaining even half the o ld subsidy Before the

,
.

revolt o f our N orth Am erican colonies w e had the monopoly o f ,

the tobacco o f M aryland and Virginia We imported about .

ninety six thousand hogsheads and the home consumption was

-

not supposed to exceed fourteen thousand To facilitate the .

great exportation which was necessary in order to rid us of the ,

rest the whole duties were drawn back provided the exportation
, ,

took place within three years .

We still have though o t altogether yet very nearly the

,
n , ,

monopoly o f the sugars o f o ur West Indian Islands If sugars .

are exported within a year therefore all the duties upon im , ,

p o t at i
r o are drawn back
n and if exported within three years ,

all the duties except half the o ld subsidy which still continues
, ,

to be retained upon the exportation o f the greater part of goods .

Though the importation o f sugar exceeds a good deal what is , ,

n ecessary for the home consumption the excess is inconsiderable ,

in comparison o f what it used to be in tobacco .

Some goods the particular Objects o f the jealousy of o u own

,
r

manufacturers are prohibited to be imported for home c o

,
n

sumption They may however upon paying certain duties be

.
, , ,

imported and warehoused for exportation But upon such .

 D raw b ac k s 3
exportat ion no part Of these duties are d rawn back Ou
,
. r

manufacturers are unwilling it seems that even this restricted , ,

importation should be e co u agedf a d are afraid lest some part

n r n

o f these goods should be stolen out of the warehouse and thus ,

come into competition with their o w It is under these regu n .

lat i
n o s only that we can import w rought silks , Fren h ambrics c c

an d lawns c allic o es painted printed stained o r dyed etc

, , , ,
.

We are unwilling even to be the carriers of French goods and ,

choose rather to forego a profit to ourselves than t su ffer those o ,

whom we consider as o ur enemies to make any profit by our ,

means No t only half the o ld subsidy but the second twenty

.
,

fiv e per cent is retained upon the exportation f all French

’

.
,
o

g o o ds.

By the fourth o f the rules annexed to the o ld subsidy the ,

d rawback allowed upon the exporta tion of all wines amounted

to a great deal more than half the duties which were at that ,

time paid upon their importation ; and it seems at that time

, , ,

to have been the object o f the legislature to give somewhat more

than ordinary encouragement to the c arrying trade in wine .

Several o f the o ther duties too which were imposed either at

the same time or subsequent to the o ld subsidy—what is called
,

the additional duty the new subsidy the one third and t wo
thirds subsidies the impost 69 the coinage o wine—were
-

, ,

,
1 2, n

allowed to be wholly drawn back upon exportation All those .

duties however except the additional duty and impost 69

'

, , 1 2,

being paid down in ready money upon importation the interest , ,

o f so large a sum occasioned an expense whi h made it u ,

c n

reasonable to expect any profitable carrying trade in this article .

Only a part therefore o f the duty called the impost on wine

, , ,

and no part o f the twenty fiv pounds the t o upon French -

e n

wines o r f the duties imposed in 74 5 in 763 and in 778

,
o 1 ,
1 ,
1 ,

were allowed to be drawn back upon exportation The t wo .

imposts o f five per cent imposed in 779 and 78 upon all .

,
1 1 1,

the former duties o f customs being allowed to be wholly drawn ,

back upon the exportation of all other goods were likewise ,

allowed to be drawn back upon that of wine The l ast duty .

that has been particularly imposed upon wine that of 78 0 is ,

1
,

allowed to be wholly drawn back an indulgence which when , ,

so many heavy duties are retained most probably could never ,

occasion the exportation o f a single ton of wine These rules .

take place with regard to all pla es of lawfu l exportation c

,

except the Brit ish colonies in America .

The st h Charles II ch 7 c alled An Act for the Encourage

1 . .
,
4 The W eal t h of N at i o n s
ment o f Trade had given Great Britain the monopoly o f supplying
,

the colonies with all the commodities of the growth o r manu

facture o f Europe and consequently with wines In a country .

o f so extensive a coast as o u r N orth A merican and West Indian

colonies where our authority was always so very s l ender and

, ,

where the inhabitants were allowed to carry o u t in their o w n ,

ships their non enumerated commodities at first t o all parts o f

,
-

Europe and afterwards t o al l parts o f Europe south o f Cape

,

Finisterre it is not very probable that this monopoly could ever

,

be much respected ; and they probably at all times found means , ,

of bringing back some cargo from the countries to which they

were allowed to carry out o n e They seem however to have .
, ,

found some di fficulty in importing European wines from the

places of their growth and they could not we l l import them from
,

Great Britain where they were loaded with many heavy duties ,

o f whi c h a considerable part was not drawn back upon exporta

tion Madeira wine n o t being a European commodity could

.
, ,

be imported directly into America and the West Indies countries ,

which in all their non enumerated commodities enj oyed a free

,
-

trade to the island o f Madeira These circumstances had prob .

ably introduced that general taste for Madeira wine which o ur ,

officers found established in all o u colonies at the commence r

ment f the war which began in 755 and which they brought
o ,
1 ,

back with them to the mother country where that wine had -

not been much in fashion before Upon the conclusion o f that .

war in 763 (by the 4 t h Geo III chap 5 Sect

,
1 all the. . . 1 ,
.

duties except £3 s were allowed to be drawn back upon the

,
ro .
,

exportation to the colonies o f all wines except French wines , ,

to the commerce and consumption o f which national prejudice

would allow no sort of encouragement The period between the .

granting o f this indulgence and the revolt o f o ur N orth American

colonies was probably t o short to admit o f any considerable o

change in the customs f those countries o .

The same act which in the drawback upon all wines except
, , ,

French wines thus favoured the colonies so much more than

,

other countries ; in those upon the greater part o f other c o m

mo d i ties favoured them much less Upon the exportation o f .

the greater part of commodities to other countries half the o ld ,

subsidy was drawn back But this law enacted that no part .

o f that duty should be drawn back upon the exportation to the

colonies of any commodities o f the growth r manufacture ,

o

either o f Europe o the East Indies except wines white c allic o e

r , ,
s,

and muslins .
 D raw b ac k s 5
Drawbacks were perhaps originally granted for the encourage
, ,

ment o f the carrying trade which as the freight o f the ships is

, ,

frequently pai d by foreigners in m oney w s supposed to be ,

a

peculiarly fitted for bringing gold and silver into the country .

But though the carrying trade certainly deserves no peculiar

encouragement though the motive of the institution w a s perhaps
,

abundantly fo lish t he ist it ut io n it self seems reasonable enough

o ,
n .

Such drawbacks cannot force into this trade a greater share Of

the capital o f the country than what would have gone to it f o

its o wn accord had there been no duties upon importation .

They only prevent its being excluded altogether by those duties .

The carrying trade though it deserves no preference ought not

, ,

to be precluded but to be left free like all other trades It is a

,
.

necessary resource fo r those capitals which cannot find empl oy

ment either in the agriculture o r in the manufactures o f the
country either in its home trade o r in its foreign trade o f c o n
,

sumption .

The revenue o f the customs instea d o f su ffering profits from

, ,

such drawbacks by that part of the duty which is retained If .

the whole duties had been retained the foreign goods upon whi c h ,

they are paid could seldom have been exported nor consequently ,

imported for want o f a market The duties therefore o f which

, .
, ,

a part is retained wou l d never have been paid .

These reasons seem su fficiently t o j ustify drawbacks and ,

would justify them though the whole duties whether upon the
, ,

produce o f domestic industry o r upon foreign goods were

‘

, ,

always drawn back upon exportation The revenue o f excise .

would in this case indeed su ffer a little and that o f the customs
, , ,

a good deal more ; but the natural balance o f industry the ,

natural division and distribution o f labour which is always more ,

o r less disturbed by such duties would be more nearly re ,

established by such a regulation .

These re asons however will justify drawbacks only upon

, ,

exporting goods to those countries which are altogether foreign

and independent not to those in which o ur merchants and
,

manufacturers enj oy a monopoly A drawback fo r example .

, ,

upon the exporta tion of European goods to o ur American

colonies will not always occasion a greater exporta tion than
what would have taken place without it By means o f the .

monopoly which o ur merchants and manufacturers enj oy there ,

the same quantity might frequently perhaps be sent thither , , ,

though the whole duties were retained The drawback there .

,

fore may frequently be pure loss to the revenue o f excise and

,
6 The W e al t h of N a t i o n s
customs without altering the state Of the trade or rendering
, ,

it in any respect more extensive Ho w far such drawbacks can .

be justified as a proper encouragement t the industry o f ur

,
o o

colonies or how far it is advantageous to the mother country

,
-

that they should be exempted from taxes which are paid by all
the rest o f their fellow subj ects will appear hereafter when I
-

come to treat o f olonies c .

Drawbacks however it must always be understood are useful

, , ,

only in those cases in which the goods for the exportation of which
they are given are really exported to some foreign country ; an d
not clandestinely re imported into o ur o w That some draw
-

n .

backs particularly those upon tobacco have frequently been

, ,

abused in this manne r and have given occasion to many frauds

,

equally hurtful both to the revenue an d to the fair trader is ,

well known .

CHA P TER V
OF B OU NT I ES

B O UNTI E S upon exportation are in Great Britai n frequently , ,

petitioned for and sometimes granted to the produce o f par

,

tic ular branches o f domestic industry By means o f them o ur .

merchants and manufacturers it is pretended will be enabled , ,

to sell their goods as cheap or cheaper than their rivals in the ,

foreign market A greater quantity it is said will thus be

.
, ,

exported and the balance o f trade consequently turned more in

,

favour o f our o w country We cannot give o ur workmen a

n .

monopoly in the foreign as we have done in the home market .

We cannot force foreigners to buy their goods as we have done

o u r o w n countrymen The next best expedient it has been
.
,

thought therefore is to pay them for buying It is in this

, ,
.

manner that the mercantile system proposes to enrich the whole

country and to put money into all our pockets by means o f the
,

balance of trade .

Bounties it is allowed ought to be given t o those branches

, ,

of trade only which cannot be carried o n without them But .

every branch of trade in which the merchant can sell his goods
fo r a price which replaces to him with the ordinary profits of ,

stock the whole capital employed in preparing and sending them

,

to market can be carried on without a bounty Every such

,
.

branch is evidently upon a level with all the other branches of

 B o un t i e s 7
trade which are carried o without bounties an d cannot there
n ,

fore require one more than they Those trades only require .

bount ies n which the merchant is obliged to sell his goods for
I

a price which does not replace t o him his capital together with ,

the ordinary profit ; o r in which he 5 obliged to sell them for 1

less than it really costs him to send them to market The bounty .

is given in order to make up this loss and to en c o uage him to ,

cont inue o r perhaps to begin a trade o f which the expense is

, ,

supposed to be greater than the returns o f which every operation ,

eats up a part of the capital employed n it and which 13 Of such I ,

a nature that if all other trades resembled it there wou l d soon

, ,

be no c apital left in the country .

The trades it is to be observed which are carrie d on by means

, ,

of bounties are the only ones which can be carried o between

,
n

two nations for any considerable time together in such a manner ,

as that o ne of them shall always and regularly lose or sel l its ,

goods fo r less than it really costs to send them to market But .

if the bounty did not repay to the merchant what he would

otherwise lose upon the price o f his goods his own interest would ,

soon oblige him to employ his stock in another way or to find ,

o u t a trade in which the price of the goods would replace to him ,

with the ordinary profit the capital employment in sending them

,

to market The effect o f bounties like that of all the other

.
,

expedients o f the mercantile system can only be to force t he ,

trade Of a country into a channel much less advantageous than

that in which it would naturally run f its own accord O .

The ingenious and wel l inf ormed author of the tracts upon
-

the corn trade has shown very learly that since the bounty c ,

upon the exportation o f corn was first established the price o f ,

the corn exported valued moderately enough has exceeded

, ,

that o f the corn imported valued very high by a much greater

, ,

sum than the amount o f the whole bounties which have been
paid during that period This he imagin es upon the true
.
, ,

principles o f the mercantile system is a cl ear proof that this ,

forced corn trade is beneficial to the nation ; the value o f the

exportation exceeding that o f the importation by a much greater
sum than the whole extraordinary expense which the public has
been at in order to get it exported He does o t consider that . n

this extraordinary expense or the bounty is the smallest part

, ,

of the expense which the exportation Of corn really costs the

society The capital which the farmer employed in raising it
.

must likewise be taken into the account Unless the price Of .

the corn when so l d in the foreign markets replaces not only the ,
 8 The W e al t h of N a t i o n s
bounty but this capital together with the ordinary profits o f
, ,

stock the society is a loser by the difference r the national

, ,
o

stock is so much diminished But the very reason fo r which it .

has been thought necessary to grant a bounty is the supposed

insu fficiency o f the price t o do this .

The average pri e of corn it has been said has fal len c n
c , , o

si d e b ly since the establishment o f the bounty

ra That the .

average pri e f corn began to fal l somewhat towards the end

c o

o f the last century and has continued to do so during the course

,

o f the sixty four first years o f the present I have already e

-

, n

d av o u ed to show
e r But this event supposing it t o be as real
.
,

as I believe it t o be must have happened in spite o f the bounty

, ,

and cannot possibly have happened in consequence o f it It .

has happ ened in France as well as in England though in France

, ,

there was n o t only no bounty but till 764 the exportation , ,

1 ,

o f corn was subje c ted to a general prohibition This gradual .

fall in the average price o f grain it i s probable therefore is , , ,

ultimately owing neither to the o ne regulation nor to the other ,

but to that gradual and insens ible r i se in the real val ue o f si lver ,

which in the first book o f this discourse I have endeavoured

, ,

t o S how has taken place i n the general market of Europe during

the c ourse o f the present century It seems t o be altogether .

impossible that the bounty could ever contribute to l ower the

pri e o f grain
c .

In years o f plenty it has alrea dy been observed the bounty

, , ,

by occasioning an extraordinary exportation ne c essarily keeps ,

up the price o f corn in the home market above what i t would

naturally fall t o To do so was the avowed purpose o f the
.

institution In years o f scarc ity though the bounty is frequently

.
,

suspended yet the great exportation which it occasions in years

,

o f plenty must frequently hinder more o r less the plenty of o ne

year from relieving the scarcity of another Both in years o f .

plenty and in years o f scarcity therefore the bounty meces , ,

sa i ly tends t o raise the mo n ey p i c e o f corn somewhat higher r

‘

than it otherwise would be in the home market .

That in the actual state o f tillage the bounty must nec es

, ,

sa ir ly have this tenden y will not I apprehend be disputed c , ,

by any reasonable person But i t has been thought by many .

people that it tends to encourage tillage and that in two ,

different ways ; first by opening a more extensive foreign,

market to the corn o f the farmer it tends they imagin e to , , ,

increase the demand for and consequently the production of ,

that commodity ; and secondly by securing to him a better ,

 B o un t i es 9
m ice than he c ould otherwise expect in the actua l sta te o f

tillage it tends they suppose to encourage tillage This double

, , ,
.

encouragement must they imag ine in a long period o f years

, , ,

o casion such an increase in the production o f corn as may

c

l ower it s price i n the home market mu h more than the bounty c

can raise it in the actual state which tillage may at the end of
, ,

that period happen to be in

,
.

I answer that whatever extension of the foreign market can

,

be occasioned by the bounty must in every particular year be , ,

altogether at the expense o f the home market ; as every bushel

o f corn which is exported by means o f the bounty and which ,

would not have been exported without the bounty would have ,

remain ed in the home market to increase the consumption and

to lower the price o f that ommodity The corn bounty it is c .
,

to be observed as well as eve ry other bounty upon exporta tion

, ,

imposes two different taxes upon the people ; fir st the tax ,

which they are obliged to contribute in order to pay the bounty ;

an d secondly the tax which arises from the advanced price
,
f the o

commodity in the home market and which as the whole body , ,

o f the people are purchasers o f orn must in this parti u l ar c , ,

c

commodi t y be paid by the whole body o f the people In this

,
.

particular commodity therefore this second tax is by mu h, ,

c

the heavier f the two Let us suppose that taking one year
o .
,

with another the bounty o f five sh illings upon the exporta tion
,

o f the quarter o f wheat raises the pri e o f that ommodity in c c

the home market o nly ixpence the bushel or four shillings t he

S ,

quarter higher than it otherwise would have been in the a tual

,
c

state o f the crop Even upon this very moderate supposition

.
,

the great body f the people over and above ontributing the
o ,
c

tax which pays the bounty of five shillin gs upon every quarter
o f wheat exported must pay another o f four shillings upon
,

every quarter which they themselves consume But accord .

,

in
g to the very well in formed author o f the-

tracts upon the corn

trade the average proportion o f the corn exported to that
,

consumed at home is not more than that f one to thirty one O -

.

F o r eve ry five shillings therefore whi h they contribute to the

, ,
c

payment of the first tax they must ontribute six pounds four ,
c

shillin gs to the payment o f the second S O very heavy a tax .

upon the first necessary o f life must either reduce the subsist
ence o f the labouring poor o r it must o c c asion some augmenta ,

tion in their pe c uniary wages proportionable to that in the

pe uniary price o f their subsistence So far as it Operates in
c .

t he o n e way it must re d uce the abil ity o f the l abouring poor to

,
I O Th e W eal t h of N at i o n s
educat e and brin g up their children and must so far ten d to , , ,

restrain the population o f the country So far as it operates in .

the other it must reduce the ability of the employers o f the

,

poor to employ so great a number as they otherwise might do ,

and must so far tend to restrain the industry o f the ountry

, ,
c .

The extraordinary exporta tion o f corn therefore occasioned by , ,

the bounty not only in every parti ular year diminishes the
, ,
c ,

home just as much as it extends the foreign market and con

, ,

sumption but by restraining the population and industry of

, ,

the country its final ten d ency is to stunt and restrain the gradual
,

extension o f the home market ; and thereby in the long run , ,

rather to d iminish than to augment the whole market and

, ,

c onsumption Of corn .

This enhancement of the money price o f corn however it has , ,

been thought by rendering that commod i ty more profitab l e to

,

the farmer must necessarily encourage its production

,
.

I answer that this might be the case if the e ffect of the bounty
,

was to raise the real price of c orn o to enable the farmer ,

r ,

with an equal quantity of it to maintain a greater number o f ,

labourers in the same manner whether liberal moderate o r , , ,

scanty that other labourers are commonly maintained in his

,

neighbourhood But neither the bounty it is evident nor any

.
, ,

other human institution can have any such e ffect It is not ,

.

the real but the nominal pri ce o f corn which can in any con
, ,

si de ab le degree be aff ected by the bounty

r And though the .

t ax which that institution imposes upon the whole body of the

people may be very burdensome to those who pay it it is of ,

very little advantage to those who receive it .

The real e ffect o f the bounty is not so much to raise the real
val ue o f corn as to degrade the re al value o f silver o r to make ,

an equal quantity o f it exchange for a smaller quantity not ,

only o f corn but o f all other home made ommodities : for the
,
.
-

money pri ce Of corn regulates that o f all o t her home made -

commodities .

It regulates the money pr ice o f l abour which must always ,

be such as to enable the labourer to purchase a quantity o f

corn su fficient t o maintain him and his family either in the l iberal ,

moderate or scanty manner in which the advancing stationary

, , ,

o r declining circumstances o f the society oblige his emp l oyers

to maintain him .

It regulates the money pri e o f al l the other parts o f the rude c

produce o f l and which in every period o f improvement must

, , ,

bear a certain proportion to that of corn though this proportion ,

 B o un t i es I I

is different in different periods It regulates for example the .

, ,

money price o f grass and hay o f butcher s meat of horses and ,

’
, ,

the maintenance of horses o f land arriage consequently o r of ,

c ,

the greater part Of the inland commerce o f the country .

By regulating the money price o f all the other parts f the O

rude produce of land it regulates that o f the materials o f almost

,

all manufac tures By regulating the money price o f labour it

.
,

regulates that o f manufacturing art and industry A n d by .

regulating both it regulates that o f the omplete manufacture

,
c .

The money p ic eo f labour and o f everything that is the produce

r ,

either o f land o r l abour must necessarily e i ther rise or fall in

,

proportion to the money price o f corn .

Though in consequence of the bounty therefore the farmer , ,

should be enabled to sell his corn f r four shillings the bushel o

-

instead of three and sixpence and to pay his landlord a money

- -

rent proportionable t this rise in the money price o f his p ro

o

duce yet if in consequence f this rise in the price of corn

, ,
o ,

four S hillings will purchase no more home made goods o f any -

other kind than three and sixpence would have done before- -

neither the ci rcumstances o f the farmer nor those o f the land

lord will be much mended by this change The farmer will o t . n

be able to cultivate much better : the landlord will n o t be able

to live much better In the purchase Of foreign commodities
.

this enhancement in the price o f corn may give them some little
advantage In that o f home made commodities it can give
.
-

them none at all And almost the whole expense o f the farmer
.
,

and the far greater part even o f that o f the landlord is in

‘

home made commodities

-

That degradation in the value Of silver which is the effect o f

the fertility o f the mines and which operates equally o very , ,
r

near equally through the greater part o f the commercial world

, ,

is a matter o f very little consequence t o any particular country .

The consequent rise o f all money prices though it does not make ,

those who receive them really richer does n o t make them real ly ,

poorer A service o f plate becomes really cheaper and every

.
,

thing else remains precisely o f the same real value as before .

But that degradation in the value o f silver which being the ,

e ffec t either o f the peculiar situation o r of the political in t it u s

tions o f a particular country takes place only in that country , ,

is a matter f very great consequence which far from tending

o , ,

to make anybody really richer tends to make everybody really ,

poorer The rise in the money pri c e Of all commodities which

.
,

is in this case peculiar to that country tends to discourage ,

12 Th e W e al t h of N at i o n s
more o r less every sort of industry which is carried o n within i t ,

and to enable foreign nations by furn ishing almost all sorts f , o

goods fo r a smaller quantity f silver than its o w workmen o n

can afford to do to undersell them not only I the foreign but

, ,
n
,

even in the home market .

It is the peculiar situation o f Spain and Portugal as p ro

r i t rs o f the mines to be the distributors f gold and silver to
p e o o

all the other countries o f Europe Those metals ought natur .

ally therefore to be somewhat cheaper n Spain and Portugal

, ,
I

than in any other part o f Europe The diff erence however .

, ,

should be no more than the amount of the freight and insurance ;

and o account of the great value and small bulk o f those
,
n

metals their freight is no great matter and the ir insurance is

, ,

the same as that o f any other goods o f equal value Spain and .

Portugal therefore could su ffer ve ry little from their peculiar

, ,

situation if they did not aggravate its disadvantages by their

,

political institutions .

Spain by taxing and Portugal by prohibit ing the exportation

,

o f gold and silver l oad that exportation with the expense f

,
o

smuggling and raise the value of those metals in other countries

,

so much more above what i t is in their o wn by the whole

amount f this expense When you dam up a stream o f water
o .
,

as soon as the dam is full as mu h water must run over the c

dam head as if there was no dam at all The prohibition of

-

exportation cannot detain a greater quantity of gold and silver

in Spain and Portugal than what they can aff ord to employ ,

than what the annual produce o f their land and labour will
allow them to employ in coin plate gilding and other orna
, , , ,

ments Of gold and silver When they have got this quantity .

the dam is full and the whole stream which flows in afterwards
,

must run over The annual exportation o f gold and silver from
.

Spain and Portugal accordingly is by all accounts n o t w it h , ,

standing these restraints very near equal to the whole annual,

importation A the water however must always be deeper

. s , ,

behind the dam head than before it so the quantity o f gold and
-

silver which these restraints detain in Spain and Portugal must ,

in proportion to the annual produce of their land and labour ,

be greater than what is to be found in other countries The .

higher and stronger the dam head the greater must be the -

di fference in the depth of water behind and before it The .

higher the tax the higher the penalties with which the p ro hib i
,

tion is guarded the more vigilant and severe the police which
,

l ooks after the execution o f the law the greater must be the ,
 B o u n t i es I
3
difference in t he proport ion o f gol d and silver to the annual
produce of the land and labour o f Spain and Portugal and t o ,

that o f other countries I t is said accordingly to be very c o n

.

sid erab le and that yo u frequently find there a profusion o f

,

plate in houses where there is nothing else which would in ,

other countries be thought suitable o r correspondent to this

,

sort o f magnificence The cheapness o f gold and si lver o r what

.
,

is the same thing the d eam es o f all commodities which is the

,
s ,

necessary e ff ect f this redundancy o f the precious metals dis

O ,

courages both the agriculture and manufactures o f Spain and

P ortugal and enables foreign nations to supply them with many
,

sorts of rude and with almost all sorts o f manufactured produce

, ,

for a smaller quantity o f gold and silver than what they them
selves can either raise or make them for at home The tax and .

prohibition Operate in t w o different ways They not only lower .

very much the value o f the precious metals in Spain and Portugal ,

but by detaining there a certain quantity o f those metals whi c h

would otherwise flow over other countries they keep up their ,

value in those other countries somewhat above what it other

wise would be and thereby give those countries a double a d v a
,
n

tage in their commerce with Spain and Portugal O pen the .

fl o d gates and there wil l presently be less water above and

o -

, ,

more below the dam head and it will soon come to a level in
,
-

both places Remove the tax and the prohibition and as the
.
,

quantity o f gol d and silver wil l diminish considerably in Spain

and Portugal so it will increase somewhat in other countries
, ,

and the value of those metals their proportion to the annual ,

produce o f land and labour will soon come to a level or very , ,

near to a level in all The loss which Spain and Portugal could
, .

sustain by this exportation o f their gold and silver would be

altogether nominal and imaginary The nominal val ue f their . o

goods and Of the annual produce o f their land and labour

, ,

would fall and would be expressed o r represented by a smaller

,

quantity o f silver than before ; but their real value would

be the same as before and would be su fficient t o maintain , ,

command and employ the same quantity o f labour As the

, , .

nominal value o f their goods would fall the real value o f what ,

remained f their gold and silver would rise and a smaller

o ,

quantity o f those metals would answer all the same purposes f o

commerce and circulation which had employed a greater quan

tity before The gold and silver which would go abroad would
.

not go abroad for nothing but would bring bac k an equal value ,

o f goo d s o f some k ind or an othe r Those goods t wou l d n o t . oo,

,
1
4 W e a l t h of N aT he
t i o n s
be all matters f mere luxury and expense to be consumed by
o
,

idle people who produce nothing return for their c o ump In ns

tion A s the real weal th and revenue of idle people would not
.

be augmented by this extraordinary exportation of gold and

S ilver so neither would their consumption be much augmented
,

by it Those goods would probably the greater part of them

.
, , ,

and certainly some part o f them consist in materials tools and , , ,

provisions for the employment and maintenance of industrious

,

people who would reproduce with a profit the full value of

, , ,

their consumption A part of the dead stock o f the society

.

would thus be turned into active stock and would put into ,

motion a greater quantity o f industry than had been employed

before The annual produce o f their lan d and labour would
.

immediately be augmented a little and in a few years would , ,

probably be augmented a great deal ; their industry being thus

,

relieved from o e o f the most Oppressive burdens which it at

n

present labours under .

The bounty upon the exportation of cornnecessarily operates

exactly in the same way as this absurd policy o f Spain and
P ortugal Whatever be the actual state o f tillage it renders
.
,

ou r c o m somewhat dearer in the home market than it other

wise would be in that state and somewhat cheaper in the ,

foreign ; and as the average money price of corn regulates more

or less that of all other commodities it lowers the value o f silver ,

considerably in the o e and tends to raise it a little in the

n ,

other It enables foreigners the Dutch in particular o t only

.
, ,
n

to eat our corn cheaper than they otherwise could do but ,

sometimes to eat it cheaper than even our own people can do

upon the same occasions as w e are assured by an excellent ,

authority that o f Sir Matthew Decker It hinders our own

, .

workmen from furnishing their goods for so small a quantity of

silver as they otherwise might do ; and enables the Dutch to
furnish theirs for a smaller It tends to render our ma ufac . n

tures somewhat dearer in every market and theirs somewhat ,

cheaper than they otherwise would be and consequently to ,

give their industry a double advantage over o u o wn r .

The bounty as it raises in the home market not so much

,

the real as the nominal price o f our c o m as it augments not , ,

the quantity Of labour which a certain quantity Of corn can

maintain an d empl oy but only the quantity of silver which it
will exchange fo it discourages our manufactures without
r, ,

rend ering any considerable service either to o ur farmers or

country gent lemen It puts indeed a li t tl e more money into
.
, ,
 B o un t i es 5
the po c kets of both and it will perhaps be somewhat difficult
,

to persuade the greater part o f them that this I s not rendering

them a very considerable service But if this money sinks n . I

its value in the quantity o f labour provisions and home made

, , ,

commodities o f all different kinds whi h it is capable of purchas ing c

as much as it rises in its quantity the service will be l i ttle more ,

than nominal and imaginary .

There is perhaps but o e set f men in the whol e common

, ,
n o

wealth to whom the bounty either was o r ould be essentially c

serviceable These were the corn merchants the exporters and

.
,

importers Of corn In years of plenty the bount y necessarily

.

occasioned a greater exportation than would otherwise have taken

place ; and by h indering the plenty of one year from relieving
the scarcity Of another it occasioned in years of scarc ity a ,

greater importation than would otherwise have been necessary .

It increased the business o f the corn mer hant in both ; and in c

years Of scarcity it not only enabled him to import a greater

,

quantity but to sell it for a better price and consequently with

, ,

a greater profit than he could otherwise have made if the plenty ,

o f one year had o t been more o less hindered from relieving

n r

the scarcity o f another It is in this set of men accordi gly .

,
n ,

that I have observed the greatest zeal for the continuance or

renewal o f the bounty .

O ur country gentlemen when they imposed the high duties ,

upon the importation of foreign corn which in times o f moderate ,

plenty amount to a prohibition and when they established the ,

bounty seem to have imitated the conduct of our manufacturers

, .

By the one institution they secured to themselves the monopoly

,

Of the home market and by the other they endeavoured to

,

prevent that market from ever being overstocked with their

commodity By both they endeavoured to raise its real value
.
,

in the same manner as o u manufacturers had by the like r ,

institutions raised the real value of many different sorts of

,

manufactured goods They did not perhaps attend to the great

.

and essential difference which nature has established between

c orn and almost every other sort of goods When either by .
,

the monopoly o f the home market or by a bounty upon exporta ,

tion you enable u woollen or linen manufacturers to sell their

,
o r

goods for somewhat a better price than they otherwise could

get for them you raise not only the nominal but the real price
, , ,

Of those goods Yo u render them equivalent to a greater

.

quantity o f labour and subsistence you increase not only the ,

nominal but the real profit the real wealth and revenue o f those
, ,
I 6 Th e W e al t h of N a t i o n s
manufacturers and you enable them either to live better t hem
,

selves o to employ a greater quantity o f labour in those

,
r

particular manufactures You really encourage those manu .

factures and direct towards them a greater quantity o f the

,

industry o f the country than what would probably go to them

o f its o w accord But when by the like institutions you raise
n .

the nominal o money price f corn you do not raise its real
r -

o ,

value You do o t increase the real wealth the real revenue

. n ,

either o f o ur farmers o country gentlemen Yo u do not r .

en c ourage the growth f corn because you do not enable them o ,

to mainta in and employ more labourers in raising it The .

nature of things has stamped upon corn a real value which

cannot be altered by merely altering its money price N o .

bounty upon exportation no monopoly o f the home market , ,

can raise that value The freest competi t ion cannot lower it
. .

Through the world in general that value is equal to the quantity

o f labour which it can maintain and every particular place ,
In

it is equal to the quantity o f labour which it can maintain in the

way whether liberal moderate or scanty in which labour is
, , , ,

commonly maintained in that place Woollen o linen cloth . r

are n o t the regulating commodities by which the real value o f

all other commodities must be finally measured and determined ;
corn is The real value f every other commodity is finally
. o

measured and determined by the proportion which its average

money price bears to the average money price Of corn The .

real value o f corn does not vary with those variations in its
average money price which sometimes occur from e century ,
on

to another It is the real value of silver which varies with them

. .

Bounties upon the exportation o f any home made commodity -

are liable first to that general objection which may be made

, ,

t oall the different expedients Of the mercantile system ; the

objection Of forcing some part o f the industry of the country
into a channel less advantageous than that in whi h it would c

run o f its o w accord and secondly to the particular Objection

n : , ,

o f forcing it o t only into a channe l that is less advantageous

,
n ,

but into o e that is actually disadvantageous ; the trade which

n

cannot be carried on but by means o f a bounty being necessarily

a losing trade The bounty upon the exportation o f corn is
.

liable to this further Objection that it can in no respect promote ,

the raising of that particular commodity o f which it was meant

to encourage the production When o ur country gentlemen .
,

therefore demanded the establishment o f the bounty though

, ,

t he y acted in i mitation of u merchants and manufacturers o r ,

 B ou n t i es I
7
they did not a t with that c omplete omprehension f their own
c c o

interest which comm only dire ts the condu t o f those t wo other c c

orders f people They loaded the publi revenue with a very

o . c

c onsiderable expense ; they imposed a very heavy tax upon the

whole body f the people ; but they did not in any sensible
o ,

degree increase the real value o f their w c ommodity ; and

,
o n

by lowerin g somewhat the real value Of silver they dis ouraged ,

c

in some degree the general industry Of the ountry and instea d

,
c , ,

o f advan in g retarded more o r less the improvement of their

c ,

ow n lands which necessarily depends upon the general industry

,

o f the ountry
c .

T en c ourage the produ tion of any o mmodi t y a bounty

o c c ,

upon produ tion o e should imagine would have a more direct

c ,
n ,

Operation than e upon exportation It would besides

on .
, ,

impose only o e t a x upon the people that which they must

n ,

contribu t e in order to pay the bounty In tead of raising it . s ,

would tend to lower the pri e o f the c ommodity in the home c

market ; and thereby instead o f imposing a se ond tax upo n ,

c

the people it might at least in part repay them for what they
, , , ,

had contributed to the first Bounties upo n production ho w .

,

ever have been very rare ly granted The prejudi es estab lished
, . c

by the commercial system have ta ught us t o be lieve that

national wealth arises more immediately from expo rta tion than
from production It has been more favoured accordingly as
.
,

the more immediate means f brin ging money in to the coun t ry o .

Bounties upon production it has been said t o have been found ,

o,

by experience more liable to frauds than those upon exp orta tion .

Ho w far this is true I k now not That bounties upon expo rta
tion have been ab ii
,
.

sed to many fraudulent purposes i very s

well known But it is not the interest o f merchants and manu

.

fac t u e s the great inventors of all these expedients that the

r r , ,

home market should be oversto c ked with their goods an event ,

whih a bo unty upon production m ight sometimes occas ion

c .

A bounty upon exportation by enablin g them t o send abroad ,

the surplus part and to keep up the price f what remain s in the
, o

home market effectually prevents this Of all the expedients

, .

o f the mercantile system accord ingly it is the f whi ch o ne O

, ,

they are the fondest I have kno wn the different underta kers
.

of some parti ular works a gree privately among themselves to

c

give a bo unty ut o f their o w po c kets upon the exportation o f

o n

a erta in proportion o f the goods which they dealt in This

c .

expedient succeeded so well that it more than doubled t he pri c e

of their goods in the home market notwithstand ing a very ,
1 8 Th e W e al t h of N a t i o n s
considerable increase in the produ e The operation Of the c .

bounty upon corn must have been wonderfully different if it

has lowered the money price o f that commodity .

Something like a bounty upon production however has been , ,

granted upon some particular occas ions The tonnage bounties

given to the white —
.

herring and whale fisheries may perhaps , ,

be considered as somewhat Of this nature They tend directly .

,

it may be supposed to render the goods heaper in the home

,
c

market than they otherwise would be In other respects their .

effects it must be acknowledged are the same as those of

, ,

bounties upon exportation By means o f them a part of the .

capital of the country is employed in bringing goods to market ,

o f wh i ch the price does not repay the cost together with the

ordinary profits of stock .

But though the tonnage bounties of those fisheries do not

contribute to the Opulence o f the nation it may perhaps be ,

thought that they contribute to its defence by augmenting the

number o f its sailors and shipping This it may be alleged may .
, ,

sometimes be done by means of such bounties at a much smaller

expense than by keeping up a great standing navy if I may use ,

such an expression in the same way as a standing army

,
.

N otwithstanding these favourable allegations however the , ,

following considerations dispose me to believe that in granting ,

at least o n e of these bounties the legislature has been very,

grossly imposed upon .

First the h erring buss bounty seems too large

,
.

From the commencement o f the winter fishing 77 to the end ,

1 1,

O f the winter fishing 78 the tonnage bounty upon the herring

,
1 1

buss fishery has been at thirty shillings the ton During these .

eleven years the whole number of barrels caught by the herring

buss fishery of Scotland amounted to The herrings
caught and cured at sea are called sea sticks In order to render -

them what are called merchantable herrings it is necessary to ,

repack them with an additional quantity of salt ; and in this

case it is reckoned that three barrels of sea sticks are usually
,
-

repacked into two barrels o f merchantable herr in gs The .

number f barrels o f merchantable herrings therefore caught

o , ,

during these eleven years will amount only a c cording to this ,

account to ,
2 During these eleven years the tonnage
bounties paid amounted to or to 8 id upon 1 15 . 5 . z .

every barrel f sea sticks and to

o -

3% d upon every
,
barrel of 1 25 . .

merchantable herrings .

The salt with which these herrings are cured is sometimes

 B o u n t i es I
9
S otch and sometimes foreign salt both which are delivered
c ,

free o f all excise duty to the fish curers The excise duty upon -

S c otch sal t is at present 5 6d tha t upon foreign salt 05 the 1 . .

,
1 .

bushel A barrel o f herrings is supposed t o require about o n e

.

bushel and one fourth of a bushel foreign salt Two bushels

-

are the supposed average o f Scotch salt If the herrings are .

entered fo r exportation no part o f this duty is paid up ; if ,

entered for home consumption whether the herrings were cured ,

with foreign with Scotch salt only o e shilling the barrel

or ,
n

is paid up It was the o ld Scotch duty upon a bushel of salt

.
,

the quantity which at a low estimation had been supposed , ,

necessary for curing a barrel o f herrings In Scotland foreign .

,

salt is very little used fo r any other purp ose but the curing o f
fish But from the 5t h A pril 77 to the 5 t h April 78 2 the
. 1 1 1 ,

quantity f foreign salt imported amounted to

o bushels ,

at eighty four pounds the bushel : the quantity o f Scotch salt

-

delivered from the works to the fi h curers to no more than s -

at fif t y six pounds the bushel only It would appear

-

.
,

therefore that it is prin cipally foreign salt that is used in the

,

fisheries Upon eve y barrel o f herrings exported there is

. r ,

besides a bounty of 8 d and more than two thirds o f the buss

,
25 . .
,
-

caught herrings are exported Put all these things together and .

you will find that during these eleven years every barrel o f , ,

buss caught herrings cured with Scotch salt when exported has , ,

cost government 75 igd ; and when entered for home con 1 . l

sumption 4s 3% d and that every barrel cured with foreign

1 . .

salt when exported has cost government £ 75 s2i ; and when

, ,
1 .

entered fo r home consumption £ 3 ggd The price of a barrel 1 5 . .

of good merchantable herrin gs runs from seventeen and eighteen

to four and five and twenty shillings about a guinea at an ,

average .
1

Secondly the bounty to the white herring fishery is a tonnage

,
-

bounty ; and i proportioned to the burden of the ship not t o her

s ,

diligence o r success in the fishery ; and it has I am afraid been , ,

t o o common for vessels to fit out for the sole purpose o f catching ,

n o t the fish but the bounty In the year 75 9 when the bounty
, . 1 ,

was at fifty shillings the t o n the whole buss fishery f Scotland ,

o

brought in only four barrels of sea sticks In that year each -

.

barrel f sea sticks cost government in bounties alone £ 3 5 s ;

o -
11 1 .

each barrel o f merchantable herrings £ 5 9 75 6d 1 . .

Thirdly the mode of fish ing for which this to n nage bounty in
,

the white herring fishery has been given (by busses o r decked
-

S th t t th d f th v l m
1
ee e a c co un s a e en o e o u e .
 o The W e al t h of N a t i o n s
vessels from twenty to eighty tons burthen) seems not so well ,

adapted to the situation of Scotland as to that of Holland from ,

the practice o f which country it appears to have been borrowed .

Hollan d lies at a great distance from the seas to which herrings

are known principally to resort and can therefore carry o that , , ,
n

fishery only in decked vessels which can carry water and pro ,

v i sions suffic ien t for a voyage t o a distant sea But the Hebrides .

o r western islands the islands of Shetland and the northern and

, ,

north western coasts of Scotland the countries in whose neigh

-

b urh o o d the herring fishery is principally carried o n are every

o ,

where intersected by arms Of the sea which run up a considerable ,

way into the land and which in the language Of the country are
, , ,

called sea lochs It is to these sea lochs that the herrings prin
-

.
-

ci p y
a ll resort during the seasons in which they visit those seas ;
fo r the visits of this and I am assured Of many other sorts of , ,

fish are not quite regular and constant A boat fishe ry there .
,

fore seems to be the mode o f fishing best adapted to the peculiar

,

situation o f Scotland the fishers carrying the herrings o shore

, n ,

as fast as they are taken to be either cured o r consume d fresh , .

But the great encouragement which a bounty o f thirty shillings

the ton gives to the buss fishery is necessarily a discouragement
to the boat fishery which having no such bounty cannot bring
, , ,

its cured fish to market upon the same terms as the buss fishery .

The boat fishery accordingly which before the establishment

, ,

o f the buss bounty was very considerable and is said to have ,

employed a number of seamen not inferior to what the buss

fishery employs at present is now gone almost entirely to decay , .

O f the former extent however o f this now ruined and abandoned

, ,

fishery I must acknowledge that I cannot pretend to speak

,

with much precision A no bounty w as paid upon the outfit . s

of the boat fishery no account w a s taken of it by the off cers

,
i

o f the customs or salt duties .

Fourthly in many parts of Scotland during certain seasons o f

, ,

the year herrings make no inconsiderable part o f the food o f

,

the common people A bounty which tended to lower their

.
,

price in the home market might contribute a goo d deal to the ,

relief of a great number o f o u r fellow subj ects whose ircum -

,
c

stances are by no means affluent But the herring buss bounty .

contributes to no such good purpose It has ruined the boat .

fishe ry which is by far the best adapted fo the supply o f the

, , ,
r

home market and the additional bounty o f 2 5 8 d the barrel

,
. .

upon exportation carries the greater part more than two thirds ,
-

of the pro d uce of the buss fishery abroad Between thirty and .
 B o u n t i es 2 I

forty years ago before the establishment o f the buss bounty

, ,

fifteen shillings the barrel I have been assured w a s the common , ,

price of white herrings B et w eem t en and fifteen years ago .

,

before the boat fishery w a s entirely ruined the price is said to ,

have run from seventeen to twenty shillings the barrel F o r .

these last five years it has at an average been at twenty fiv e

, , ,
-

shillings the barrel This high price however may have been
.
, ,

owing to the real scarcity o f the herrings upon the coast o f

Scotland I must observe t o o that the cask o r barrel which
.
, , ,

is usually sold with the herrings and of which the price is included ,

in all the foregoing prices has since the commencement o f the , ,

American war risen to about double its former price o from

, ,
r

about three shillings to about six shillings I must likewise .

observe that the accounts I have received of the prices of former

times have been by no means quite uniform and consistent ; and
an o ld man o f great accuracy and experience has assured me
that more than fifty years ago a guinea was the usual price o f a
, ,

barrel of good merchantable herrings ; and this I imagine may , ,

still be l ooked upon as the average price All accounts however .

, ,

I think agree that the price has not been lowered in the home
,

market in consequence o f the buss bounty .

When the undertakers f fisheries after such liberal bounties o ,

have been bestowed upon them continue to sell their commodity ,

at the same o even at a higher price than they were a customed

,
r c

to do before it might be expected that their profits should be

,

ve ry great ; and it is n o t improbable that those o f some indi

vi du als may have been s o In general however I have every .
, ,

reason to believe they have been quite otherwise The usual .

effect Of such bounties is to encourage rash undertakers to a d

venture in a business which they do n o t understand and what ,

they lose by their o w negligence and ignorance more than n

compensates all that they can gain by the utmost liberality o f

government I n 75 0 by the same act which first gave the
. 1 , ,

bounty o f thirty shillings the ton for the encouragement of the

white herring fishery (the 3 d Geo II chap
-

a j oint stock 2 r . . .
-

company was erected with a capital o f five hundred thousand

,

pounds to which the subscribers (over and above al l other

,

encouragements the tonnage bounty just now mentioned the

, ,

exportation bounty o f two shillings and eightpence the barrel ,

the delivery o f both British and foreign salt duty free ) were ,

during the spa e o f fourteen years for every hundred pounds

c
,

which they subscribed and paid in to the stock o f the society ,

entitl ed to three pounds a year to be pai d by the receiver ,

22 Th e W eal t h of N at i o n s
general o f the customs in equal half yearly payments Besides -

this great company the residence of whose governor and ,

directors was to be in London it was declared lawfu l to erect ,

different fishig chambers in all the different o ut ports Of the

n - -

kingdom provided a sum n o t less than ten thousand pounds

,

was subscribed into the capital o f each to be managed at its ,

own risk and for its o wn profit and loss The same annuity
,
.
,

and the same encouragements o f all kinds were given to the ,

trade o f those inferior chambers as to that of the great o m c

pany The subscription o f the great company was soon filled

.

up and several different fishig chambers were erected in the

,
n -

different out ports o f the kingdom In spite o f all these e

-
. n

c o u ageme t s almost all those diff erent companies both great

r n , ,

and small lost either the whole or the greater part o f their
, ,

capitals ; scarce a vestige n o w remains of any o f them and the ,

white herring fishery is now entirely o almost entirely carried

-

,
r ,

on by private adventurers .

If any particular manufacture was necessary indeed for the , ,

defence Of the society it might not always be prudent to depend

,

upon o u neighbours for the supply ; and if such manufact ure

r

c ould not otherwise be supported at home it might not be ,

unreasonable that all the other branches o f industry shou l d be

taxed in order to support it The bounties upon the exportation .

o f British made sail cloth and British made gunpowder may

- - -

perhaps both be vindicated upon this principle

,
.

But though it can very seldom be reasonable to tax the

industry o f the great body of the people in ord er to support
that o f some parti ular c lass of manufacturers yet in the
c ,

wantonnes s o f great prosperity when the public enjoys a greater ,

revenue than it knows well what to do with to give such ,

bounties to favourite manufactures may perhaps be as natural , ,

as to incur any other idle expense In pub l ic as well as in .

private expenses great wealth may perhaps frequently be

, , ,

admitted as an apology for great folly B ut there must surely .

be something more than ordinary absurdity in continuing such

profusion in times o f general difficu l ty and distress .

What is called a bounty is sometimes no more than a draw

back and consequently is not l iable to the same objections as
,

what is properly a bounty The bounty f example upon .

,
or ,

refined sugar exported may be considered as a drawback f the o

duties upon the brown and muscovado sugars from which it is

made The bounty upon wrought silk exported a drawback o f
.
,

the duties upon raw and thrown silk imported The bounty .
 B o un t i es 2 3
upon gunpowder exported a drawback o f the duties upon ,
“

brimstone and saltp etre imported In the language of the .

cu stoms those allowances only are c alled drawbacks which are

given upon goods exported in the same form in which they are
imported When that form has been so altered by manufacture
.

o f any kind as to come under a new denomination they are ,

called bounties .

Premiums given by the public to artists and manufacturers

who excel in their particular occupations are not liable to the
same Objections as bounties By encourag ing extraordinary .

dexterity and in genuity they serve to keep up the emulation f

,
O

the workmen actually employed in those respective occupations ,

and are not considerable enough to turn towards any o n e of

them a greater share o f the capital Of the country than what
would go to it of its o w accord Their tendency is not to
n .

overturn the natural balance o f employments but to render the ,

work which is done in each as perfect and complete as possible .

The expense o f premiums besides is very trifling ; that o f , ,

bounties very great The bounty upon corn alone has some
.

times cost t he public in o e year more than three hundred n

thousand pounds .

Bounties are sometimes called premiums as drawbacks are ,

sometimes called bounties But we must in all cases attend to

.

the nature o f the thing without paying any regard to the word .

DI G RES S I O N CO N C E R N I N G TH E C O R N T R ADE AND

CO RN L AW S
I cannot conclude this chapter concer in g bounties without n

Obse ving that the praises which have been bestowed upon the
r

law which esta blishes the bounty upon the exportation Of corn ,

and upon that system o f regulations which is connected with it ,

are altogether unmerited A particular examination o f the.

nature of the corn trade and of the principal British laws which
,

relate to it will sufficiently demons trate the truth o f this asser

,

tion The great importan e f this subject must justify the

. c o

le gth of the digression

n .

The trade o f the c orn merchant is composed of four different

branches which though they may sometimes be all carried o
, , n

by the same person are in their wn nature four separate and

,
o

distinct trades These are first the trade of the inland dealer ;
.
, ,

secondly that o f the merchant importer fo r home consumption ;

,

thirdly that o f the merchant exporter o f home produce for

,
24 The W eal t h of N a t i o n s
foreign consumption ; and fourthly that f the merchant , ,
o

carrier o o f the importer of orn in order to export it again

,
r c .

1 The interest o f the inland dealer and that o f the great

.
,

body o f the people how Opposite soever they may at first sight
,

appear are even in years of the greatest scarcity exactly the

, , ,

same It is his interest to raise the price o f his corn as high

.

as the real scarcity o f the season requires and it can never be ,

his interest to raise it higher By raising the price he dis .

courages the consumption and puts everybody more o less but ,

r ,

parti ularly the inferior ranks f people upon thrift and good
c o ,

management If by raisin g it t o o high he discourages the

.
, ,

consumption so much that the supply of the season is likely to

go beyond the consumption of the season and to last for some ,

time after the next crop begins to come in he runs the hazard , ,

not only o f losing a considerable part of his corn by natural

causes but o f being obliged to sell what remains of it fo much
,
r

less than what he might have had for it several months before .

If by o t raising the price high enough he discourages the o

n c n

sumption so little that the supply of the season is likely to fal l

short of the consumption of the season he not only loses a part ,

Of the profit which he might otherwise have made but he ,

exposes the people to su ffer before the end of the season instead ,

of the hardships o f a dearth the dreadful horrors of a famine ,

.

It is the interest Of the people that their daily weekly and , ,

monthly onsumption should be proportioned as exactly as

c

possible to the supply Of the season The interest of the inland .

corn dealer is the same By supplying them as nearly as he .

,

can judge in this proportion he is likely to sell all his corn for
, ,

the highest price and with the greatest profit ; and his know
,

ledge o f the state of the crop and of his daily weekly and , , ,

monthly sales enable him to judge with more or less ac uracy

, ,
c ,

ho w far they really are supplied in this manner Without .

intending the interest o f the people he is necessari ly led by a , ,

regard t o his own interest to treat them even in years of , ,

scarcity pretty much in the same manner as the prudent master

,

Of a vessel is sometimes obliged to treat his crew When he .

foresees that provisions are likely to run short he puts them ,

upon short allowance Though from excess o f caution he should

.

sometimes do this without any real necessity yet all the ic o ,

n n

ve i
n e es which his crew can thereby su ffer are inconsiderable
nc

in comparison f the danger misery and ruin to which they

o , ,

might sometimes be exposed by a less provident condu t c .

Though from excess o f avarice in the same manner the i land . ,

n
 B o u n t i es 25

corn merchant should sometimes raise the price o f his corn

somewhat higher than the sca rcity o f the season requires yet all ,

the in onvenien es which t he people can su ffer from this o n

c c c

duct which e ffectually secures them from a famin e in the end

,

o f the season are in considerable in comparison o f what they

,

might have been exposed to by a more liberal way f dealing o

in the beginning of it The corn merchant himself is likely to

.

s ufie r the most by this excess o f avarice ; not only from the
indignation which it generally excites against him but though , ,

he should escape the effect s o f this indignation from the quan ,

tit y o f corn which it necessarily leaves upon his han ds in the

end o f the season and which if the next season happens to
, ,

prove favourable he must always sell for a much lower price

,

t han he might othe rwise have had .

Were it possible indeed f r o e great company o f merchants

, ,
o n

to possess themselves of the whole crop o f an extensive country ,

it might perhaps be their interest to deal with it as the Dutch

, ,

are said to do with the spiceries o f the M olu cas to destroy o r c ,

throw away a considerable part o f it in order t o 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 wherever the law leaves the trade free it is o f ll

, ,
a

commodities the least liable to be engrossed o r monopolised by

the force f a few large capitals which buy up the greater part
o ,

o f it
. N ot only its value f exceeds what the capita ls f ar o

a few private men are capable of purchas ing but supposing , ,

they were capable of pur c hasing it the manner in which it is ,

produced renders this purchase altogether impra ticable As in c .

every civilised country it is the commodity f which the annual o

consumption is the greatest so a greater quantity f industry ,

o

is annually employed in producing orn than in produ ing any c c

other commodity When it first comes fro m the ground t o o it

.
, ,

is necessarily divided among a greater nu mber o f owners than

any other com modity ; and these ow ers can never be collected n
“

into one pla e like a number o f independent manufacturers but

c ,

are necessarily scattered through all the different c orners f the o

country These first owners either immediately supply the

.

consu mers in their own neighbourhood o they supply other ,

r

inland dealers who supply those consu mers The inland dealers .

in corn therefore including both the farmer and the baker are
, , ,

n ecessarily more numerous than the dealers in any other com

mo d i t y and their dispersed situation renders it altogether i

, m
possible for them to e n ter into any general combination If in .

II B
26 The W e al t h of N a t i o n s
a year of scarcity therefore any o f them should find that he had
, ,

a good deal more corn upon hand than at the current price , ,

he could hope to dispose f before the end o f the season he

o
,

woud never think of keeping up this price to his wn 105 and o 5,

to the sole benefit f his rivals and competitors but would

o ,

immediately lower it in order to get rid o f his corn before the

,

n ew crop began to come in The same motives the same .

,

interests which would thus regulate the conduct f any o n e

,
o

dealer would regulate that of every other and oblige them all
, ,

in general to sell their corn at the price whi h according to the c ,

best of their judgment was most suitable to the scarcity o r

,

plenty o f the season .

Whoever examines with attention the history o f the dearths

and famines which have fflic t ed a y part of Europe during
a
'

n ,

either the course o f the present r that of the t w preceding o o

centuries of several o f which we have pretty exact accounts

, ,

will find I believe 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 parti ular places by the waste of w a but in by
c ,
r,

far the greatest number o f cases by the fault of the seasons ;

and that a famine has never arisen from any other ause but c

the violence of government attempting by improper means to , ,

remedy the inconveniences of a dearth .

In an extensive corn country between a l l the different parts ,

of which there is a free commerce and communication the ,

scarcity occasioned by the most unfavourable seasons can never

be so great as to produce a famine ; and the scantiest crop if ,

managed with frugality and economy will maintain through ,

the year the same number f people that are commonly fed ono

a more affluent manner by one of moderate plenty The seasons .

most unfavourable to the crop are those o f excessive drought o r

excessive rain But as corn grows equally upon high and low
.

lands upon grounds that are disposed to be too wet and upon
, ,

those that are disposed to be t o o d ry either the drought r the ,

o

rain which is hurtful to o e part of the country is favourable to

n

another ; and though both in the w et and in the dry season the
crop is a good deal less than in one more properly tempered ,

yet in both what is lost in one part o f the country is in some

measure compensated by what is gained in the other In rice .

countries where the crop not only requires a very moist soil
, ,

but where in a certain period of its growing it must be laid

unde r wa ter the e ffects of a drought are much more dismal
, i
 B o u n t i es 2
7
Even in such countries however the drought is perhaps scarce
, , , ,

ever so universal as necessarily to occasion a fami e if the n ,

government would allow a free trade The drought in Bengal .

,

a few years ago might probably have occasioned a very great

,

dearth Some improper regulations so m e inj udicious restraints

.
,

imposed by the se r vants of the East India Company upon the

r ce trade contributed perhaps to turn that dearth into a
i , , ,

famine .

Wh en the government in order to remedy the inconveniences ,

o f a dearth orders all the dealers t o 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 i

,
n

the beginning of the season ; or if they bring it thither it ,

enables the people and thereby encourages them to consume it

,

so fast as must necessarily produce a famine before the end o f

the season The unlimited unrestrained freedom o f the corn
.
,

trade as it is the only e ffectual preventative o f the miseries o f

a fani
,

n e so it is the best palliative o f the inconveniences o f a

i ,

dearth ; for the inconveniences o f a real scarcity cannot be

remedied they can only be palliated NO trade deserves more
,
.

the full protection of the law and no trade requires it so much , ,

because no trade is so much exposed to popular odium .

In years o f scarcity the inferior ranks f people impute their o

distress to the avarice o f the corn merchant w h becomes the ,

o

obj ect f their hatred and indignation Instead o f making

o .

profit upon such occasions therefore he is often in danger o f , ,

being utterly ruined and o f having his magazines plundered

,

and destroyed by their violence It is i years o f scar ity . n c ,

however when prices are high that the corn merchant expects
, ,

to make his principal profit He generally n contract with . is i

some farmers to furnish him for a certain number of years with

a certain quantity of corn at a certain price This ontract . c

price is settled according to what supposed to be the moderate 15

and reasonable that the ordinary o average price which

,
is , r
,

before the late years o f scarcity was commonly about eight

and twenty shillings for the quarter o f wheat and for that o f
-

other grain in proportion In years o f scarcity therefore the .

, ,

corn merchant buys a great part f his corn f the ordinary o or

price and sells it fo r a much h gher That this extraordinary

,
i .

p rofit however
,
is no more than su fi
f cient
,
to put his trade upon
a fair level with other trades and to co mpensate the many ,

losses which he sustains upon other occasions both from the ,

perishable nat u re o f the commo d ity it self and from the frequent ,
 2 8 Th e W eal t h of N a t i o n s
and unforeseen fluctuations o f its price seems evident enough , ,

from this single circumstance that great fortunes are as seldom ,

made in this as in any other trade The popular odium how .

,

ever which attends it in years of scarcity the only years in

, ,

which it can be very profitable renders people o f character and ,

fortune averse to enter into it It is abandoned to an inferior .

set o f dealers ; and millers bakers mealmen and meal factors , , , ,

together with a number of wretched hucksters are almost the ,

only middle people that in the home market come between , ,

the grower and the onsumer c .

The ancient policy of Europe instead of discountenancing ,

this popular odium against a trade so beneficial t o the public ,

seems on the contrary to have authorised and encouraged it

, ,
.

By the 5 t h and 6t h o f Edward VI cap 4 it w a enacted . . 1 ,

s ,

That whoever should buy any corn o grain with intent to sell r

it again should be reputed an unlawful engrosser and should

, , ,

for the first fault su ffer t w o months imprisonment and forfeit

,
’
,

the value o f the corn ; for the second su ffer six months im ,
’

prisonment and forfeit double the value ; and fo the third b e

,
r ,

set in the pillory suffer imprisonment during the king s pleasure

,
’
,

and forfeit all his goods and chattels The ancient policy o f .

most other parts o f Europe was no better than that o f England .

O ur ancestors seem to h ave imagined that the people would

buy their corn cheaper f the farmer than o f the corn mer o

chant who they were afraid would require over and above
, , , ,

the price which he paid to the farmer an exorbitant profit to ,

himself They endeavoured therefore to annih ilate his trade

.
, ,

altogether They even endeavoured to hinder as mu h as

. c

possible any middle man of any kind from coming in between

the grower and the consumer ; and this was the meaning of
the many restraints whi h they imposed upon the trade f c o

those who m they c alled kidders o carriers of c o m a trade r ,

whi h nobody was allowed to exercise without a li ence c e

c c as r

taining his qualifi ations as a man of probity and fair dealing

c .

The authority o f three j ustices of the peace was by the statute ,

o f Edward VI necessary in order to grant this licence But

.
, .

even this restraint was afterwards thought insu fficient and by a ,

statute of Elizabeth the privilege o f granting it was confined to

the quarter— sessions .

The ancient policy of Europe endeavoured in this manner to

regulate agr iculture the great trade o f the country by maxims
, ,

quite d ifferent from those which it established with regard to

manufactures the great trade o f the to wns By leaving t he
,
.
 B o u n t i es 2
9
farmer no other customers but either the consumers or their
immediate factors the kidders and arriers o f corn it endeavoured
,
c ,

to force him t o exercise the trade no t only o f a farmer but o f a , ,

corn mer hant o corn retailer O the contrary it in many

c r . n ,

cases prohibited the manufac turer from exercising the trade o f

a shopkeeper from selling his w goods by retail It meant
,
or o n .

by the e law to promote the general interest of the c ountry

on ,

o r to render corn heap without perhaps its being well under

c , , ,

stood ho w this was to be done By the other it meant to .

promote that o f a particular order of men the shopkeepers , ,

who would be so much undersold by the manufacturer it w a s ,

supposed that their trade would be ruined if he was allowed to

,

reta il at all .

The manufacturer however though he had been allowed to

, ,

keep a shOp and to sell his o w goods by retail could not have
,
n ,

undersold the common shopkeeper Whatever part o f his capita l .

he might have placed in his shop he must have withdraw it ,

n

from his manufacture In order to carry o his business o a

. n n

level with that of other people as he must have had the profit ,

o f a man u facturer on the one part so he must have had that o f ,

a shopkeeper upon the other Let us suppose for example .

, ,

that in the particular town where he lived ten per cent w as ,

.

the ordinary profit both o f manufacturing and shopkeeping

stock ; he must in this ase have harged upon every piece of
c c

his o w goods whi h he sold in his shop a profit of twenty per

n c ,

cent When he carried them from his workhouse to his shop

.
,

he must have valued them at the pri e for which he could have c

sold them to a dealer o shopkeeper who would have bought r ,

them by wholesale If he valued them lower he lost a part o f

.
,

the profit o f his manufacturing capital When again he sold .

them fro m his shop unless he got the same pri e at whi h a
,
c c

shopkeeper would have sold them he lost a part o f the profit ,

o f his shopkeeping apital Though he might appear therefore

c .
, ,

to make a double profit upon the same piece o f goods yet as ,

these goods made successively a part of t w o distin t apitals c c ,

he made but a single profit upon the whole capital employed

about them ; and if he made less than his profit he w as a loser , ,

or did not employ his whole capital with the same advantage
as the greater part of his neighbours .

What the manufacturer w prohibited to do the farmer was as ,

in some measure enjoined to do ; to divide his c apital between

two different employments ; to keep o e part of it in his granaries n

and stack yard fo r supplying the occ asional demands o f the

,
30 The W eal t h of N a t i o n s
market ; and to employ the other in the cultivation of his land .

But as he could not afford to e mploy the latter for less than the
ordinary profits of farming sto k o he could as little afford to c ,
s

employ the former for less than the ordinary profits o f mercantile
stock Whether the stock which really carried on the busin ess o f
.

the corn merchant belonged to the person wh w called a farmer o as ,

or to the person who w a called a corn merchant an equal profit s ,

wa i
s n both ases requisite in order to indemnify its owner for
c

employing it in this manner ; in order to put his business upon

a level with other trades and in order to hinder him from having,

an interest t change it as soon as possible f some other The

o or .

farmer therefore w ho w as thus forced to exercise the trade of a

, ,

co n merc hant ould not afford to sell his corn heaper than any
r ,
c c

other c o m mer hant would have been obliged to do in the ase

c c

o f a free competition .

The dealer who can employ his whole stock in o e sin gle n

branch o f business has an advantage o f the same kind with the

workman w ho employ his whole labour in o e single opera
c an n

tion As the latter acquires a dexterity which enables him

.
,

with the same two hands to perform a much greater quantity ,

of work ; so the former acquires so easy and ready a method o f

transacting his business o f buying and disposing o f his goods , ,

that with the same capita l he can transact a much greater

quantity of business As the o e can commonly fl o d his work
. n a r

a good deal heaper so the other can commonly afford his goods
c ,

somewhat cheaper than if his stock and attention were both

employed about a greater variety o f objects The greater part .

of manufac turers ould not afford to retail their o w goods so

c n

cheap as a vigilant and active shopkeeper whose sole business ,

it was t o buy them by wholesale and t o retail them again The .

greater part o f farmers ould still less afford to retail their own
c

corn to supply the inhabita ts of a town at perhaps four r five

,
n ,
o

miles distan e from the greater part o f them so heap as a

c ,
c

vigilant and active corn mer hant whose sole busi ess it wa to c ,
n s

purchase corn by wholesale t o collect it into a great ma azine ,

g
,

and to retail it again .

The law which prohibited the manufacturer from exercising

the trade o f a shopkeeper endeavoured to force this division In

the employment of stock to go on faster than it might otherwise

have done The law which obliged the farmer to exercise the
.

trade o f a corn merchant endeavoured to h inder it from going

on so fast Both laws were evident violations o f natural liberty
.
,

and therefore unjust ; and they were both too as impolitic as , ,

 B o un t ies 3 I

they were unjust It is the in terest o f every society that things

.

o f this ki d should never either be forced

n obstructed The or .

man who employs either hi labour or his stock in a greater s

variety o f ways than his situation renders necessary can never

hu rt his neighbour by undersellin g him He may hurt himself .
,

and he generally does 0 Ja k f ll trades will never be rich 5 . c o a ,

says the proverb But the law ought always t o trust people
.

with the care of their o w i terest as i their local situ at ons n n ,

n i

they must generally be able to judge bett er of it tha the n

l egislator can do The law however whi h obliged the farmer

.
, ,
c

t o exercise the trade o f a corn merchant was b y far the mos t

p re nicious o f the two .

It obstructed not only that division in the employment o f

sto k which 5 so advanta geous to every socie t y but t obstructed
c 1 ,
i

likew ise the improvement and cultivation of the land By .

obliging the farmer to carry n two trades instead o f e it o on ,

forced him to divide his capital into t w o parts of whic h e ,

on

onl y could be employed in cultivation But if he had been at .

lib erty to sell his whole crop to a o n merchant as fast as he c r

could thresh it o ut his whole capital might have returned

,

immediately to the land and have been employed in buying ,

more ca ttle and hiring more servants in order to improve and

, ,

cultivate it better But by bein g ob liged to sell hi orn by

. s c

retail he was obliged to keep a great part of hi capita l in his

,
s

gran aries and sta k yard through the year and ould not there
c ,
c ,

fore cult ivate so well as with the same capital he might other
,

wise have done This law therefore necessarily obstructed the

.
, ,

improvement of the land and instead f tendin g to render corn , ,

o

cheaper must have tended to render it scarcer and therefore

, ,

dearer than it would otherwise have been

,
.

A fter the business o f the farmer that o f the corn merchant is ,

i n reality the trade which if properly protected and encouraged , ,

would contribute the most to the raising o f cor It would n .

support the trade of the farmer in the same manner as the trade ,

o f the wholesale dealer supports that o f the manufa t urer c .

The wholesale dealer by affordin g a ready market to t he ,

manufacturer by ta king his goods o ff his hand as fast as he can

,

make them and by sometimes even advan ing their pri e to him
,
c c

before he has made them enables him to keep his whole capital , ,

and sometimes even more than his whole capital consta ntly ,

employed in manufacturing and onsequently to manufacture ,

c

a mu c h greater quantity o f goods than if he was obliged to

dispose o f them himself to the immediate consumers o even :
,
r
32 The W e al t h of N at i o n s
to the retailers As the capital f the wholesale merchant t o o
. o , ,

is generally sufficient to replace that of many manufacturers ,

this intercourse between him and them interests the owner o f

a large capital to support the owners of a great number of small
ones and to assist them in those losses and misfortunes which
,

might otherwise prove ruinous to them .

An intercourse o f the same kind universally established

‘

between the farmers and the corn merchants would be attended

with e ffects equally benefi ial to the farmers They would be c .

enabled t o keep their whole capitals and even more than their ,

whole capitals constantly employed in cultivation In case of

,
.

any o f those ac idents to which no trade is more liable than

c ,

theirs they would find in their ordinary customer the wealthy

, ,

corn merchant a person who had both an interest to support

,

them and the ability to do it and they would not as at present

, , , ,

be entirely dependent upon the forbearance o f their landlord ,

or the mercy o f his steward Were it possible as perhaps it is .

,

not to establish this intercourse universally and all at once

, , ,

were it possible to turn all at once the whole farming stock o f

the ki gdom to its proper business the cultivation of l and
n , ,

withdrawing it from every other employment into which any

part of it may be at p ese t d iv e t ed and were it possible in r n r , ,

order to support and assist upon occasion the Operations o f this

great stock to provide all at once another stock almost equally
,

great it is not perhaps very easy to imagine how great how

, ,

extensive and how sudden would be the improvement which

,

this change o f circumstances would alone produce upon the whole

face of the country .

The statute of Edward VI therefore by prohibiting as much .

, ,

as possible any middle man from coming in between the grower

and the consumer endeavoured to annihilate a trade o f which
, ,

the free exercise is n t only the best palliative o f the i c oo n n

v en i
e ci en f a dearth but the bestpreventative of that calamity
s o

after the trade o f the farmer no trade contributing so much to ,

the growing f corn as that o f the corn merchant

o .

The rigour of this law was afterwards softened by several

subsequent statutes which successively permitted the engross
,

ing o f corn when the price o f wheat should not exceed twenty ,

twenty four thirty two and forty shillings the quarter At

-

,
-

,
.

last by the ist h o f Charles II c 7 the engrossing or buying o f

,
. .
,

corn in order to sell it again as long as the price o f wheat did t ,

no

exceed forty eight shillings the quarter and that o f other grain ,

in proportion was declared lawful to all persons not being fore

,
 B o un t i es 33
that is not selling again in the same market within
s t allers , ,

three months All the freedom which the trade of the inland
.

corn dealer has ever yet enj oyed was bestowed upon it by this
sta tute The st atute of the twelfth of the present king which
.
,

repeals almost all the other ancient laws against engrossers and
forestallers does not repeal the restrict ons f this particular
,
i o

sta tute which therefore still continue in force

,
.

This statute however authorises in some measure t w o very

, ,

absurd popular prejudices .

First it supposes that when the price f wheat has risen so

,
o

h igh as fo rty eight shillings the quarter and that o f other grains ,

in proport on corn is likely to be so engrossed as to hurt the

i ,

people But from what has been already said it seems evident
.
,

enough that corn can at no price be so engrossed by the inland

dealers as to hurt the people and forty eight shillings the : -

quarter b esides though it may be considered as a very high

, ,

price yet in years of scarcity it is a price which frequently takes

,

place immediately after harvest when scarce any part f the ,

o

new crop can be sold ff and when it is impossible even for o ,

ignorance to suppose that any part o f it can be so engrossed as

to hurt the people .

Secondly it supposes that there is a cert ain price at which

,

co rn is likely to be forestalled that is bought up in order to be , ,

sold again soon after in the same market so as to hurt the ,

people But if a merchant ever buys up corn either going to

.
,

a particular market or in a particular market in order to sell ,

it again soon after in the same m arket it must be because he ,

j udges that the market cannot be so liberally supplied thro ugh

the whole season as upon that parti ular o casion and that the c c ,

pri e therefore must soon rise If he j udges wrong in this and

c , , .
,

if the price does not rise he not only loses the whole profit o f ,

the stock which he empl ys in this manner but a part of the o ,

sto k itself by the expense and loss which necessarily attend

c ,

the storing and keeping f cor He hurts himself therefore o n .

, ,

much more essentially than he can hurt even the part icular
people whom he m y hinder from supplying themselves upon a

that particular market day because they may afterwards supply ,

themselves just as cheap upon any other market day If he .

judges right instead f hurting the great body of the people

,
o ,

he renders them a most important se vice By making the m r .

fee l the inconveniencies f a deart h somewhat earlier than they o

otherwise might do he prevents their feeling them afterwards

,

so severely as they certainly would do if the cheapness of price ,

II B 2
34 The W e al t h of N a t i o n s
encouraged them to consume faster than suited the real scarcity
o f the season When the scarcity is real the best thing that can
.
,

be done for the people i to divide the inconvenienc es f it as

s i o

e qually as possible throu gh all the different months and weeks , ,

a d days
n f the year
o The interest of the corn merchant makes
.

him study to d o this as exactly as he can and as no other :

person can have either the same interest or the same know ,

ledge o r the same abilities to do it so exactly as he this most

, ,

important Operation o f commerce ought to be trusted entirely

to him ; r in other words the corn trade so far at least as
o
’

, , ,

concerns the supply o f the home market ought to be left ,

perfectly free .

The popular fear o f engrossing and forestalling may be c o m

pared to the popular terrors and suspicions o f witchcraft The .

unfortunate wretches accused o f this latter crime were not

more innocent o f the misfortunes imputed to them than those
w h have been accused of the former
o The law which put an .

end to all prosecutions against witchcraft which put it o u t o f ,

any man s power to gratify his own malice by accusin g his

’

neighbour of that imaginary crime seems e ffectually to have ,

put an end to those fe ars and suspicions by taking away the

great cause which encouraged and supported them The l w . a

which should restore entire freedom to the inland trade o f corn

would probably prove as e ffectual to put an end to the popular
fears f engrossing and forestalling
o .

The 5 th f Charles II c 7 however with all its imperfections

1 o . .
, ,

has perhaps contributed more both to the plentiful supply of the

home market and to the increase of tillage than any other l w
, ,
a

in the statute book It is from this law that the inland corn
.

trade has derived all the liberty and protection which it has ever
yet enj oyed ; and both the supply o f the ho m e market and the ,

interest of tillage are much more e ffectually promoted by the

,

inland than either by the importation or exportation trade .

The proportion of the average quantity of all sorts o f grain

imported into Great Britain to that f all sorts of grain con o

sumed it has been computed by the author o f the tracts upon

,

the corn trade does not exceed that f one to five hundred
,
o

and seventy For supplying the home market therefore the

.
, ,

importance o f the inland trade must be to that o f the importa

tion trade as five hundred and seventy to o e n .

The average quantity f all sorts o f grain exported from Great

o

Britain does o t according to the same author exceed the o n e

n , ,

and thirtieth part f the annual produce For the encourage

-
o .
 B o u n t i es 35
ment of tillage therefore by providing a market for the home
, ,

produce the i mportance of the inland trade must be to that o f

,

the exp o t io trade as thirty to o n e

ra n .

I have no great faith in politi al arithmetic and I mean o t c ,

n

to warrant the exactness f either f these computations I o o .

mention them only in order to show o f h w mu h less c o c on

sequence in the Opinion o f the most j udicious and experienced

,

persons the foreign trade f corn is than the ho m e trade Th e

,
o .

great cheapness f corn in the years im mediately preced ing the

o

es t ablishment of the bounty m y perhaps with reason be a , ,

ascribed in so me measure to the operation of this sta t ute o f

Charles II which had been enacted about fiv e and twenty years
.
,
- -

b efore and whi h had therefore full time t o produ e its e ffect
,
c c .

A very few words will uflic ie t ly explain all that I have to s n

say concerning the other three branches of the c orn trade .

II The trade of the merchant importer o f foreign corn fo

. r

home consumption evidently ontributes t o the im mediate c

supply f the home market and must so far be immediately

o ,

benefi ial to the great body f the people It tends ind ee d t o

c o .
, ,

lower somewhat the average money price o f corn but not to ,

diminish its real value or the quantity o f labour which it is

,

capable of maintaining If i mportation was at all times free.

,

o u r farmers and country gentlemen would probably one year , ,

with another get less money for their corn than they do at
,

present when importation at most times in e ffect prohibited

,
is
,

but the money which they got would be f more value would o ,

buy more goods f all other kinds and would employ more
o ,

labour Their real wealth their real revenue therefore would

.
, , ,

be the same as at present though it might be expressed by a ,

smaller quantity f silver ; and they would neither be disabled

o

nor discouraged from c ultivating orn as mu h as they do at c c

present O n the ontrary as the rise in the real value o f silver

. c , ,

in consequen e f lowering the money price o f orn lowers some

c o c ,

what the money price f all other commodities it gives the o ,

industry of the country where it takes place some advantage , ,

in all foreign markets and thereby tends to encourage and ,

increase that indust y But the extent f the home market for
r . o

c orn must be in proportion to the general industry f the country o

where it grows to the number of those w h produce some

,
or o

thing else and therefore have something else what omes to

, ,
or c

the same thing the price o f something else to give in exchange

, ,

for corn But i every country the home market as t i the

. n
,
i s

nearest and most conven ent so is it likewise t he greatest and i ,

 36 Th e W ea l t h of N a t i o n s
most important market fo corn That rise in the real value r .

of silver therefore which the e ffect of lowering the average

, ,
Is

money price of corn tends to enlarge the greatest and most ,

important market for corn and thereby to encourage instead , ,

of dis c ouraging its growth ,

.

By the d of Charles II c 3 the importation o f wheat

2 2n . . 1 , ,

whenever the price in the home market did not exceed fift y
thr ee shillings and fourpence the quarter w a subjected to a ,
s

duty of sixteen shillings the quarter ; and to a duty f eight o

shillings whenever the price did not exceed four pounds The .

former o f these two prices has fo more than a entury past ,

r c
,

taken place only in times f very great scarcity ; and the latter o

has so far as I know not taken place at all Yet till wheat
, ,
.
,

had risen above this latter price it was by this statute sub ,

j ec t ed to a very high duty ; and till it had risen above the ,

fo mer t o a duty which amounted to a prohibition The im

r ,
.

p o t at io r f other sorts o f grain was restrained at rates and by

n o ,

duties in proportion to the value of the grain almost equally

, ,

high Subsequent laws still further increased those duties

.
1
.

The distress which in years o f scarcity the strict execution , ,

of those laws might have brought upon the people would prob ,

ably have been very great But upon such occasions its .
, ,

execution was generally suspended by temporary statutes which ,

permitted for a limited time the importation o f foreign corn

, ,
.

The necessity f these te mporary statutes su ffic iently demon o

strates the impropriety of this general e on .

These restraints upon importation though prior to the estab ,

li shme t of the bounty were di tated by the same spirit by

n ,
c ,

the same principles whi h afterwards enacted that regulation ,

c .

Ho w hurtful soever in themselves these some other restraints ,

or

upon importation be ame necessary in consequence o f that c

B f
1
th t h
e ore
3 f t h p t ki g t h f ll w i
e 1 g w t h d ti p y o e r esen n e o o n er e e u es a
bl p t h imp t t i f t h diff t t f g i
,

a e u on e or a on O e er en so r s o ra n

Gra i
n . D ut i
es . D ut i
es . D ut i
es .

B ean s t o 2 8s p er qr 1 95 1 0d a f t ill er t 4 05 i6s 8d t h en 1 2d .

l
. . . . . . .

B a r ey t o 2 8 5 1 95 1 0d 32 s 1 6s 1 2d
l p h bi d by t h l M lt il
. . . . . . .

Ma t is r o i t e e a nn u a a t ax B l
f
.

O a t s t o 1 6s 55 1 0d a t er 9 &d
f
. . . .

Pease t o 4 05 1 6s 1 0d a t er 9 2d
ill h
. . . .

R ye t o 365 1 95 1 0d t 4 05 1 6s 8d t en 1 2d
Wh ill h
. . . . . . .

ea t t o 4 45 2 15 9d t 5 35 4d 1 75 t en 85
ill 4 1 d f t t h t b t 4 d
. . . . . . .

t an a er a a ou I S
k wh t t 3 p q t p y 6
. . .

B uc ea o 25 . er r . o a 1 5 .

Th di ff t d t i w imp d p t ly by t h
es e er en d f Ch l II u es er e o se ar e 2 2n o ar es in
pl f t h Old S b idy p t ly by t h N w S b idy by t h O t h i d
, .
,

ac e o e u s ar e e u s e ne r an d
t w t h i d S b idy d by t h S b idy 7 4 7
, ,

o -
r s u s ,
an e u s 1 .
 Bo u n t i e s 37
regulation If when wheat was either below forty eight s hillings
.
,
-

the quarter o not much above it foreign corn could have been
,
r
‘

imported either duty free , o u p o p ayig only a small du t y it r n t

n ,

might have been exported again with the benefit f the bounty ,
o ,

to the great loss f the public revenue and to the entire per
o ,

version o f the institution of which the object was to extend the ,

market for the home growth not that for the growth of foreign ,

countries .

III The trade o f the merchant exporter o f corn for foreign

.

consumption certainly does not contribute directly to the

plentiful supp ly o f the home market It does so however .
, ,

in directly From whatever sour e this supply may be usually

. c

drawn whether from home growth or from foreign impor t ation

, ,

unless more orn is either usually grown or usually imported

c ,

into the ountry than what is usually consumed in it the supply

c , ,

o f the home market ca never be very plentiful But unless n .

the su rplus can in all ordinary cases be exported the growers ,

wi ll be careful never to grow more and the importers never to ,

import more than what the bare consumption of the home

,

market requires That market will very seldom be overstocked ;

.

but it will generally be understocked the people whose business ,

it is to supply it being generally afraid lest their goods should

.

be left upon their hands The prohibition o f exportation limits .

the improve ment and ultivation o f the country to what the c

supply o f its o wn inhabitants requires The freedom o f ex .

p o rt a t i
o enables it to extend cultivation for the supply f
n o

foreign nations .

By the t h of Charles II 4 the exportation of corn was

12 . c .
,

permitted whenever the price of wheat did not exc eed forty
shillings the quarter and that of other grain in proportion By
,
.

the 5 th o f the same prince this liberty was extended till the
1
,

price of wheat exceeded forty eight shillings the quarter ; and -

by the d to all higher pri es

2 2n , A poundage indeed was to c .
, ,

be paid to the king upon su h exportation But all grain was c .

rated so low in the book f rates that this poundage amounted o

only upon wheat to a shilling upon oats to fourpen e and upon

'

,
c ,

all other grain to ixpen e the quarter By the t of William

S c . rs

and Mary the a c t whi h established the bounty this small duty
, c ,

wa s virtually taken o ff whenever the price of wheat did ot n

exceed forty eight shillings the quarter ; and by the t h and

-

r1
12 t h o f William III 0 0 it was expressly taken ff at all
. . 2 o
,

higher pri es c .

The trade f the merchant exporter was in this manner o t

o
, ,
n
38 The W e al t h of N at i o n s
only encouraged by a bounty but rendered much more free than ,

that of the inland dealer By the last of the se statutes corn .

,

could be engrossed at any price for exportation but it could ,

not be engrossed for inland sale except when the price did
not exceed forty eight shillings the quarter The i terest o f t h
-

. n e

i nl and dealer however it has already been shown can never b e

, , ,

Opposite to that o f the great body o f the people That of the .

merchant exporter may and in fact sometimes is If while his

, .
,

o w n country labours under a dearth a eighb ouring country ,

n

should be affl icted with a famine it might be his interest to ,

carry c orn to the latter country in such quantitie s as might

very much aggravate the calamities o f the dearth The p le t i . n

fu l supply of the home market w s not the direct object of a

those statutes ; but under the pretence o f encouragin g agric ul

,

t ure t o raise the money price o f corn as high as possible and

, ,

thereby to occasion as mu h as possible a constant dearth in

,
c ,

the home market By the discouragement o f imp ortati o n the

.
,

supply o f that market even in times o f great scarcity was con

, ,

fined to the home growth ; and by the encouragement of ex

,

p o rt a t i
o when the
n, price was so high as fo r ty eight shilling s -

the quarter that market was not even in times of considerab le

, ,

scarcity allowed to enjoy the whole of that growt h The

,
.

temporary laws prohibiting for a limited time the exportation

,

of corn and taking o ff for a limited time the duties upon its
,

importation expedients to whi c h Great Britain has been obliged

,

so frequently to have recourse su ff ciently demonstrate the ,

i

impropriety of her general system Had that system been go o d .

,

she would not so frequently have been redu ed to the necessity c

of departing from it .

Were all nations to follow the liberal system of free exporta

tion and free importation the different states into which a great
,

continent was divided would so far resemble the different pro

vinces of a great empire As among the different provinces f
. o

a great empire the freedom of the inland trade appears both ,

from reason and experience not only the best palliative o f a ,

dearth but the most e ffe c tual preventative of a famine ; so

,

would the freedom of the exportation and importation trade be

among the different states into which a great continent was
divided The larger the ontinent the easier the c o mmu ic
. c ,
n a

tion through all the different parts o f it both by land and by ,

water the less would any one particular part of it ever be

,

exposed to either o f these calamities the s c arcity o f any one ,

country being more likely to be relieved by the plenty of some

 B o un t i e s 39
other But very few countries have entirely ad opted this liberal
.

system The freedom of the co n trade is almost everywhere

. r

more or less restrained and in m an y count ries is c o nfin ed ib y

, , ,

such absurd regulations as frequently aggravate the unavoidable

misfortune of a dearth into the dreadful calamity o f a famine .

The demand o f su c h countries for corn may frequently become

so great and so urgent that a small state in their neighbour
hood which ha ppened at the same time to be labouring under
,

some degree o f dearth could o t venture to supply them without

,
n

expos ing itself to the like dreadful calamity The very bad .

policy of e country may thus render it in some measure

on

dangerous d imprudent to esta b l ish what would otherwise be

an

the best po licy in another The unlimited freedom of exporta .

tion however would be much less dangerous in great states in

, , ,

which the growth being much gr e ter the supply could seldom a ,

be much afiec t ed by any quantit y o f corn that was likely to

be exported In a Swiss canton o r in some of the little sta tes
.
,

o f Italy it may perhaps sometimes b e necessary to restrain

,

the expo rta tion o f corn In such great countries as France or .

England it scarce ever can To hinder besides the farmer from .

, ,

send ing his goods at all times to the best market is evidently
to sacrifice the ordinary laws o f justice to an idea of public
utility to a sort o f reasons o f state ; an act Of legislative
,

authority which ought to be exercised o nly which can be ,

pardoned only in cases o f the most urgent necessity The p ice . r

at which the exportation of corn is prohibited if it is ever to ,

be prohibited ought always to be a very high price

, .

Th laws concerni
e ng co n may everywhere be compared to r

the laws conce ning religion The people feel themselves so

r .

much interested in what relates either to their subsistence in

this life r to their happiness in a life to come that gove
,
o ,

ment must yield to the ir prejudices and in order to preserve , ,

the publi tranquillity establish that system whi h they approve

c , c

of. It is upon this accoun t perhaps that we so seldom find a , ,

reasonable system established with regard to either f those two o

capital objects .

IV The trade o f the merchan t carrier o of the importer o f

.
,
r

foreign corn in order to export it again ontributes to the ,

c

plentiful supply of the home market It i not indeed the direct . s

pu pose of his t ade to sell his corn there But he will generally
r r .

be willing to d o so and even for a good deal less money than

,

he might exp ect in a foreign m arket ; be ause he saves in this c

manner the expense of loadin g and unloading o f freight and ,

4 0 Th e W e al t h of N at i o n s
i nsurance The inhabitants
. the country which by means of
of ,

the carrying trade becomes the magazine and storehouse for

,

the supply of other countries can very seldom be in want them

selves Though the arrying trade might thus ontribute to
. c c

reduce the average money price o f corn in the home m arket ,

it would not thereby lower its real value It would only raise .

somewhat the real value o f silver .

The carrying trade was in e ffect prohibited in Great Britain ,

upon all ordinary occasions by the high duties upon the im ,

p r
o t at i
o n o f foreign corn o f the greater part Of which
,
there
was no drawback ; and upon extraordinary occasions when a ,

scarcity made it necessary to suspend those duties by temporary

statutes exportation was always prohibited By this system
,
.

of laws therefore the carry ing trade was in e ff ect prohibited

, ,

upon all occasions .

That system o f laws therefore which is connected with the

, ,

establishment o f the bounty seems to deserve no part of the ,

praise which has been bestowed upon it The improvement and .

prosperity o f Great Britain which has been so often ascribed ,

t o those laws may very easily be accounted for by other causes

,
.

That security which the laws in Great Britain give to every

man that he shall enj oy the fruits of his o w n labour is alone
su fficient to make any country flourish notwithstanding these ,

and twenty other absurd regulations of commerce ; and this

security was perfected by the revolution much about the same
time that the bounty w a s established The natural e ffort o f .

every individual to better his o wn condition when suffered to ,

exert itself with freedom and security is so powerful a principle ,

that it is alone and without any assistance not only capable

, ,

of carrying o the society to wealth and prosperity but o f

n ,

surmounting a hundred i mpertinent obstructions with whi h the c

folly f human laws too often incumbers its Operations ; though

o

the e ffect o f these obstructio ns is always more o less either r

to encroa h upon its freedom o r to diminish its security In

c ,
.

Great Britain industry is perfectly secure ; and though it is far

fro m being perfectly free it is as free freer than in any other
,
or

part of Europe .

Though the period o f the greatest prosperity and improve

ment of Great Britain has been posterior to that system of laws
which is c o n ec t ed with the bounty we must not upon that
n n ,

a c count impute it to those laws It has been posterior likewise .

to the national debt But the national debt has most assuredly
.

m t been the cause of it .

 B o u n t i es 4 I

Though the system o f laws which is connected with the

bounty has exactly the same tendency with the police of S pain
and Portugal to lower s mewhat t he value of the prec ous
,
o ~ i

metals in the country where it takes place yet Great Brita in ,

is certainly n e of the richest countries in Europe while Spain

o ,

and Portugal are perhaps among the most beggarly This .

difference f situation however may easily be accounted for

o , ,

from two different ca uses First the tax in Spain the p o h ib i

.
, ,
r

tion in Portugal o f exp orting gold and silver and the vigilant ,

police which watches over the execution of those laws must , ,

in two very poor countries which between them import annually

,

upwards o f six millions sterlin g O p erate not only more directly ,

but much more forcibly in reducing the value f those metals o

there than the corn laws ca do in Great Brita in And n .

,

secondly this bad policy is not in those countries counter

,

balanced by the general liberty and securit y f the people o .

In d ustry is there neither free nor secure and the civil and ,

ecclesiastical governments of both Spain and Portugal are such

as would alone be sufficient to perpe tuate their present state o f
poverty even though their regulations of ommerce were a s
,
c

wise as the greater part of them are absurd and foolish .

The 3th of the present king c 4 3 seems to have established

1
,
.
,

a n ew system with regard to the orn laws in many respects c ,

better than the ancient one but in e o r two respects perhaps

,
on

not quit e so good .

By this statute the high duties upon impor t ations for home
consumption are taken o ff so soon as the price o f middlin g wheat
rises to forty eight shillings the quarter ; that f middl ing rye
-

o ,

pease o beans to thirty two shillin gs ; that o f barley to twenty

r ,
-

four shillings ; and that o f oats to sixteen shillin gs ; and instead

o f them a s m all duty is i m posed of only ixpence upon the S

quarter o f wheat and upon that o f other grain in proport ion

, .

With regard to all these different sorts o f grain but particularly ,

with regard to wheat the ho m e market thus opened to foreign

,
is

supplies at pri c es considerably lower than before .

By the same stat ute the ld bounty o f five shillings upon the
o

exportation of wheat ceases so soon as the price r ises to forty

four shilli gs the quarter instead of forty eight the pr ce at
n
, ,
i

whi h t ceased before ; that of two shillings and ixpence upon

c i S

the exportation of barley eases so soon as the pr e rises t c ic o

twenty two shillings instead of t w e t y four the price at which

-

,
n -

it ceased before ; that of two shillings and ixpen e upon the S c

exporta tion f oatmeal ceases so soon as the price rises to

o
4 2 Th e W e al t h of N a t i o n s
fourteen shillings instead of fifteen the price at which it ceased
, ,

before The bounty upo rye is reduced from three shillings

. n

and S ixpence to three shillings and it ceases so soon as the pr ce ,

i

rises to twenty eight shillings instead f thirty t w the price o o,

at which it ceased before If bounties are as improper as I .

have endeavoured to prove them to be the sooner they cease , ,

and the lower they are so much the better ,

.

The same statute permits at the lowest prices the importa , ,

tion of corn in order to be exported again duty free provided

, ,

it is in the meantime lodged in a warehouse under the joint locks

Of the king and the importer This liberty indeed extends to .
, ,

no more than twenty fi e o f the di fferent ports o f Great Britain

-

v .

They are however the principal ones and there may n o t

, , , ,

perhaps be warehouses proper for this purpose in the greater

,

part of the others .

So far this law seems evidently an improvement upon the

ancient system .

But by the same law a bounty of two shillings the quarter is

given for the exportation of oats whenever the pri e does not c

exceed fourteen shillings N o bounty had ever been given .

before fo the exportation of this grain no more than for that of

r
,

pease o r beans .

By the same law t o o the exportation o f wheat is prohibited

, ,
-

so soon as the price rises to forty four shillings the quarter ; -

that o f rye so soon as it rises to twenty eight shillings ; that of -

barley so soon as it rises to twenty two shillings ; and that o f -

oats so soon as they rise to fourteen shillings Those several .

prices seem all of them a good deal too low and there see ms to ,

be an impropriety besides in prohibiting exportation altogether

, ,

at those precise prices at whi h that bounty which w a given c ,

s

in order to force it is withdrawn The bounty ought certainly

, .

either to have been withdrawn at a much lower price o r ex ,

p r
o t a t i
o n ought to have been allowed at a much higher .

So far therefore this law seems to be inferior to the ancient

, ,

system With all its imperfections however we may perhaps

.
, ,

say o f it what w said f the laws of Solon that though not t he

as o , ,

best in itself it is the best which the interests prejudices and

, , ,

temper of the times would admit f It may perhaps in due o .

time prepare the way fo a better r .

 T r e a t i e s of C o mm e r c e 43

CHA PTE R VI <

or TR AT
E I ES OF CO MM E RCE

W H E N a nation binds itself by treaty either to permit the entry

of certain goods from e foreign country which it prohibits
on

from all others o to exempt the goods o f o e count y from

,
r n r

duties t whi h it subjects those f all others the country o r

o c o , ,

at least the merchants and manufacturers of the country whose ,

commerce is so favoured must necessarily derive great a d ,

van t age from the treaty Those merchants and manufacturers

.

enjoy a sort of monopoly in the country which is so indulgent t o

them That country becomes a market both more extensive
.

and more advantageous for their goods more extensive because : ,

the goods o f other nations being either excluded or subj ected to

heavier duties it takes o ff a greater quantity o f theirs more
,
:

advantageous because the merchants o f the favoured country

, ,

enj oying a sort o f monopoly there will often sell their goods for ,

a better price than if exposed to the free competition o f al l

other nations .

Such treaties however though they may be advantageous to

, ,

the merchants and manufacturers of the favoured are necessarily ,

disadvantageous to those f the favouring country A monopoly o .

is thus granted against them to a foreign nation ; and they must

frequently buy the foreign goods they have occasion for dearer
than if the free competition o f other nations was admitted .

That part of its w produce with which such a nation purchases

o n

foreign goods must consequently be sold cheaper because when ,

two things are exchanged for n e another the cheapness o f the o ,

one is a necessary consequence o rather is the same thing with ,

r

the d am e s o f the other The exchangeable value f its annual

e s . o

produce therefore is likely to be diminished by every such

, ,

treaty This diminution however can scarce amount to any

.
, ,

positive loss but only to a lessening of the gain which it might

,

otherwise make Though it sells its goods heaper than it other

. c

wise might d o it will not probably sell them for less than they
,

cost ; o as i the case o f bounties f a price which will not

n r, n ,
or

repla e the apital employed in bringing them to market

c c ,

together with the ordi ary profits f sto k The trade could
n o c .

not go o long if it did Even the favouring country therefore

n .
, ,

may still gain by the trade though less than if there was a fre e
,

competition .
44 T he W eal t h of N at i o n s
Some treat ies o f commerce however have been supposed , ,

advantageous upon principles very different from thes e ; and a

commercial ountry has sometimes granted a monopoly f this
c o

kind against itself to certain goods f a foreign nation because o ,

it expe ted that in the whole commerce between them it would

c ,

a nnually sell more than it would buy and that a balance in ,

gold and silver would be annually returned to it It is upon .

this principle that the treaty o f commerc e between England and

Portugal concluded i 703 by Mr Methuen has been so mu c h
,
n 1 .
,

co mmended The following i a literal translation o f that treaty

. s ,

w hich consists of three articles only .

I A RT . .

His sacred royal majesty o f Portugal promises bo t h in his ,

ow name and that o f his successors to admit for ever here

n , , ,

after into P ortugal the woollen cloths and the rest of the
, , ,

woollen manufactures o f the British as was accustomed till , ,

t hey were prohibited by the law ; nevertheless upon this

condition :
A RT II . .

That i s t o say that her sacred royal majesty of Great Britain

,

shall in her o w name and that o f her successors be obliged

,
n , , ,

fo ever hereafter t o admit the wines f the growth of Portugal

r ,
o

into Britain ; so that at no time whether there shall be peace ,

o rw a between the kingdoms f Britain and France anything

r o ,

more shall be demanded for these wines by the name of Custom

o rduty o by whatsoever other title directly o indirectly
,
r ,
r ,

whether they shall be imported into Great Britain in pipes o r

hogsheads o other casks than what shall be demanded fo r the

,
r ,

like quantity or measure of French wine deducting or abating a ,

third part o f the ustom duty But if at any time this

c or .

dedu c tion o abatement of customs which is to be made as

r ,

aforesaid shall in any manner be attempted and prejudiced it

, ,

shall be just and lawful for his sacred royal majesty o f Portugal ,

again to prohibit the woollen cloths and the rest o f the British ,

woollen manufac tures .

A RT III . .

The most excellent lords the plenipotentiaries promise and

t ke upon the mselves that their above named masters shall
a ,
-

ratify this treaty ; and within the space o f two months the
r at i o s shall be ex hanged
fic a t i n c .
 T reat i e s o f C o m m er c e
"
45
By this treaty the crown o f Portugal becomes bound to admit
the English woollens upon the same footing as before the pro
hi bitio ; that is not to raise the duties whi c h had been paid
n ,

before that time But it does not b e ome bound to admit

‘

. c

them upon any better terms than those of any other nation of ,

France o Holland for example The crown of Great Britain

r .
,

on the contra y be omes bound t o admit the wines of Portugal

r ,
c

upon paying only two thirds of the duty whi h is paid for those
-

o f Fran e the wines most likely to c ome into

c ,
ompetition with c

them So far this treaty therefore is evidently advantageous

.
, ,

to Portugal and disadvantageous to Great Britain

,
.

It has been celebrated however as a masterpiece of t he , ,

commercial polic y of England Portugal receives annually .

from the Brazils a greater quantity f gold than be employe d o c an

in its domestic ommerce whether in the shape f co n o r o f

c ,
o i

plate The surplus is too valuable to be allowed to lie idl e

.

and lo c ked up in offers and as it find no advantageous

c ,
c an

market at home it must notwithstandin g any prohibition be

, , ,

sent abroad and exchanged for something for whi h there is a

,
c

more advantageous market at home A large share of it come s .

annually to England in return either for English goods or for

, ,

those f other European nations t hat re eive their return s

o c

through England Mr Baretti was informed that the weekly

. .

packet boat from Lisbon brings o e week with another more

-

,
n ,

than fifty thousand pounds in gold t o England The sum had .

probably been ex ggerated It would amount to m ore than

a .

two millions six hundred thousand pounds a year whi h is more ,

c

than the Brazils are supposed to afford

,

Ou mer hants were some years ago out of humour with t he

r c

crown of Portugal Some privileges whi h had been granted

. c

them not by treaty but by the free grac e of that rown at the
, ,
c ,

solicitation indeed it is probable and in return f mu c h greate

, ,
or r

favours defenc e and protection from the crown of Great Britain

, ,

had been either infringed or revoked The people therefore .

, ,

usually most interested in elebrating the Portugal trade were c

then rather disposed to represent it as less advantageous than

it had commonly been imagined The far greater part almost .
,

the whole they pretended of this annual i mportation f gold

, ,
o ,

was not a ount o f Great Britain but of other European

on cc ,

nations ; the f uits and wines o f Portugal annually imported

r

into Great Britain nearly compensating the value of the British

goods sent thither .

Let us suppose however that the whole was o account o f

, ,
n
4 6 T he W e al t h of N a t i o n s
Great Britain and that it amounted to a still greater sum than
,

Mr Baretti seems to imagine ; this trade would not upon that

.
,

account be more advantageous than any other in which for the

, ,

same value sent o ut we re eived an equal value of consumable

,
c

goods in return .

It is but a very small part of this importation which it be ,

can

supposed is employed as an annual addition either to the plate

,

or to the oin o f the kingdom The rest must all be sent abroad
c .

and exchanged for consumable goods of some kind o other r .

But if those onsumable goods were purchased directly with the

c

produce f English indus t ry it would be more fo the advantage

o ,
r

o f England than first to purchase with that produce the gold o f

P ortugal and afterwards to purchase with that gold those

, con

sumable goods A direct foreign trade o f consumption is always

.

more advantageous than a round about o e ; and to bring the -

n

same value o f foreign goods to the home market requires a ,

much smaller capital in the o e w ay than in the other If a n .

smaller share o f its industry therefore had been employed in , ,

producing goods fit for the Portugal market and a greater in ,

producing those fit for the other markets where those ,

con

sumable goods for which there is a de mand in Great Britain are

to be had it would have been more for the advantage o f England
,
.

To pro ure both the gold which it wants for its own use and
c , ,

the onsu mable goods would in this way employ a much

c , , ,

smaller capital than at present There would be a spare c apital .

,

therefore to be e mployed for other purposes in exciting an

.

, ,

additional quantity o f industry and i rais ng a greater annual ,

n i

p roduce .

Though Britain were entirely excluded from the Portugal

trade it could find very little difficulty in procuring all the
,

a nnual supplies o f gold whi ch it wants either f r the purposes ,

o

o f plate o f coin o
,
or of foreign trade Gold like every other
,
r .
,

commodity is always so mewhere o another to be got f its

,
r or

value by those w ho have that value to give for it The annual .

surplus o f gold in Portugal besides would still be sent abroad , , ,

and though not carried away by Great Britain would be carried ,

away by so me other nation which would be glad to sell it again ,

fo its pri e in the sam e manner as Great Britain does at present

r c ,
.

In buying gold o f Portugal indeed w e buy it at the first hand ; , ,

wh ereas in buying it o f any other nation except Spain we

, , ,

should buy it at the second and might pay somewhat dearer ,

.

This difference however would surely be too insignificant to

, ,

d eserve the public attention .

 T r eat i e s of C o m m er c e 47
Almost all our gold it is said comes from Portugal With
, ,
.

other nations the balance of trade is either against us o not ,

r

much in our favour But we should remember that the more

.

g old we import from o e country the less w e must necessarily

n ,

import from all others The e ffect ual demand for gold like
.
,

that fo r every other commodity s in every country limited to ,

I

a certain quantity If nine tenths f this quant ty are imported

.
-
o i

from o country there remains a tenth only to be imported

ne ,

from all others The more gold besides that is annually im

.

ported from some particular countries over and above what ,

is requisite fo r plate and for oin the more must necessarily be c ,

exported t o some others ; and the more that most insignifi ant c

object f modern policy the balance o f trade appears to be in

o , ,

o ur favour with some particular ountries the more it must c ,

necessarily appear to be against us with many others .

It w a upon this silly notion however that England could

s , ,

not subsist without the Portugal trade that towards the end , ,

o f the late war France and Spain without pretending either

, ,

o ffence o provocation required the King f Portugal to exclude

r ,
o

all B it ih ship from his ports and for the security f this
r s
'

s ,
o

exclusion to receive into them French o Spanish garrisons

,
r .

Had the kin g of Portugal submitted to those gnominious terms I

which his brother i law the king o f Spain proposed to him

-

n ,

Britain would have been freed from a much greater i c n on

ve i
n e c y than the loss o f the Portugal trade
n the burden o f ,

supporting a very weak ally so unprovided o f everything for ,

his o w defence that the whole power f England had it been

n o ,

directed to that single purpose ould s ar e perhaps have de ,

c c c

fended him for another campaign The loss of the Portugal .

trade would no doubt have occasioned a considerable embar

, ,

ra ssme t to the mer hants at that time engaged in it who

n c ,

might not perhaps have found u t for a year or two any

, ,
o , ,

other equally advantageous method f employing the r capitals ; o i

and in this would probably have consisted all the nconveniency i

which England could have su ffered from this notable p ece f i o

commercial policy .

The great annual importation of gold and silver is neither for

the purpose of plate nor f oin but of foreign trade A round o c , .

about foreign trade of consu mption can be arried on more c

advantageously by means o f these metals than f almost any o

other goods As they are the universal instru ments of m

. co

merce they are more readily received in return f all c m

,
or o

mo d i ties than any other goods ; and n account of their small o

4 8 The W e al t h of N at i o n s
bulk and great value it costs less to transport them backward ,

and forward from one place to another than almost any other
sort of merchandise and they lose less of their value by being ,

so transported O f all the commodities therefore which are

.
, ,

bought in o n e foreign country for no other purpose but to be ,

sold or exchanged again for some other goods in another there ,

are none so onvenient as gold and silver In facilitating all

c .

the different round about foreign trades of consumption which -

are carried on in Great Britain consists the principal advantage

o f the Portugal trade ; and though it is not a capital advantage ,

it is no doubt a considerable o e n .

That any annual addition which it can reasonably be sup ,

posed is made either to the plate or to the coin o f the kingdom

, ,

could require but a very small annual importation of gold and

silver seems evident enough ; and though we had no direct
,

trade with Portugal this small quantity could always some , ,

where or another be very easily got ,

.

Though the goldsmiths trade be very considerable in Great ’

Britain the far greater part of the new plate which they annually
,

sell is made from other old plate melted down ; so that the
addition annually made t the whole plate o f the kingdom o

cannot be very great and could require but a very small annual ,

importation .

It is the same case with the coin N obody imagines I .

,

believe that even the greater part o f the annual co in age

, ,

amounting for ten years together before the late reformation

, ,

of the gold coin to upwards of eight hundred thousand pounds

,

a year i gold was an annual addition to the money before

n ,

current in the kingdom In a country where the expense f . o

the coinage is defrayed by the government the value of the ,

coin even when it contains its full standard weight of gold and
,

silver can never be much greater than that of an equal quantity

,

of those metals uncoined ; because it requires only the trouble

of going to the mint and the delay perhaps of a few weeks to , ,

procure fo any quantity of uncoined gold and silver an equal

r

quantity of those metals in coin But in every country the .

, ,

greater part o f the current coin is almost always more o less r

worn or otherwise degenerated from its standard In Great

,
.
‘

Britain it was before the late reformation a good deal 0 the

, ,
5 ,

gold being more than two per ent and the silver more than c .

eight per cent below its standard weight But if forty four
. .
-

guineas and a half c ontaining their full standard weight a pound

, ,

weight o f gold could purchase very little more than a pound

,
 Tr eat i es of C o mm er c e 49
w eight of uncoined gold forty four guineas and a half wanting ,
-

a part of their weight ould not purchase a pound weight and c ,

something was to be added in d e t make up the deficiency or r

e
o .

The current price of gold bullion at market therefore instead , ,

o f being the same with the mint price o £4 6 4 6d was ,

r 1 5 . .
,

then about £4 7 4 5 and someti mes about £4 8 When the

1 . .

greater part o f the coin however was in this degenerate , ,

condition forty four guineas and a half fresh from the mint
,
-

, ,

would purchase no more goods in the market than any other

o rdinary guineas because when they came into the co ffers o f
,

the merchant being confounded with other money they could

, ,

not afterwards be distinguished without more trouble than the

di ff erence was worth Like other guineas they were worth no .

more than £4 6 4 6d If thrown into the melting pot how

1 5 . .
,

e ver they produced without any sensible 105

,
a pound weight
,
5,

o f standard gold which could be sold at any time fo r between

,

£ 4 71 4 5 and
.
£4 8 either in gold o silver as fit fo r all the pur r ,

poses f coin as that which had been melted down There was
o .

an evident profit therefore in melting down new coined money

, , ,

and it was done s o instantaneously that no precaution o f ,

government could prevent it The operations f the mint were . O ,

upon this account somewhat like the web of Penelope ; the

,

work that w done in the day was undone in the night The
as .

mint w a s employed not so much in making daily additions to

,

the coin as in replacing the very best part f it which w a daily

, o s

melted down .

Were the private people w h carry their gold and silver t o ,

o

the mint to pay themselves for the coinage it would add t o

, ,

the value o f those metals in the same manner as the fashion

does to that f plate Coined gold and silver would be more
o .

valuable than uncoined The seignorage if it w not ex b i .

,
as or

tant would add to the bullion the whole value f the duty ;
, o

because the government having everywhere the exclusive

,

privilege of coining no coin can co me to market cheaper than

,

they think proper to afford it If the duty w a exorbitant . s

indeed that is if it was very much above the real value f the
, ,
o

labour and expense requisite for coinage false co iners both at , ,

home and abroad might be encouraged by the great difference

, ,

betw een the value o f bullion and that of coin to p o u i so great ,

r n

a quantity o f counterfeit money as might reduce t he value o f

the government money In France however though the .
, ,

seignorage is eight per cent no sensible inconveniency f this .

,
o

kind is found to arise from it The dangers t o which a false .

5 0 The W eal t h of N at i o n s
co mer is eve rywhere exposed if he lives in the country of which ,

he counterfeits the coin and to which his agents corre , or

s p o n d e t s are exposed if he lives in a foreign

n ountry are by c ,

far too great to be in c urred for the sake o f a profit o f six o r

seven per cent .

The seignorage in France raises the value of the coin higher

than in proportion to the quantity of pure gold which it con
tains Thus by the edict of January 7 6 the mint price o f
. 1 2 ,
1

fine gold o f twenty four carats w a fixed at seven hundred and -

forty livres nine sous and one denier o e eleventh the mark o f n -

eight Paris ounces The gold coin o f France making an allow .

,

ance for the remedy of the mint contains twenty one carats ,
-

and three fourths o f fine gold and two carats n e fourth o f

-

,
o -

alloy The mark o f standard gold therefore is worth no more

.
, ,

than about six hundred and seventy one livres ten deniers -

But in France this mark of standard gold is coined into thirty

Lo uis d ors o f twenty four livres each o r into seven hundred
-
’
-

and twenty livres The coinage therefore increases the value .

, ,

of a mark f standard gold bullion by the di fference between

o ,

six hundred and seventy one livres ten deniers and seven -

hundred and twenty l ivres ; r by forty eight livres nineteen o -

sous and two deniers .

A seignorage will in many cases take away altogether and , , ,

will in all cases dimi ish the profit f melting down the ew
, ,
n o n

coin This profit always arises from the difference between the
.

quantity o f bullion which the common currency ought to con

tain and that which it actually does ontain If this difference
,
c .

is less than the seignorage there will be 105 instead of profit ,

5 .

If it is equal to the seignorage there will neither be profit ,

nor

loss If it is greater than the seignorage there will indeed be

.
,

some profit but less than if there w a no seignorage If before

,
s .
,

the late reformation o f the gold coin for example there had , ,

been a seignorage o f five per cent upon the coinage there would .
,

have been a loss of three per cent upon the melting down o f .

the gold coin If the seignorage had been two per cent there
. .

would have been neither profit loss If the seignorage had nor .

been o e per cent there would have been a profit but o f o n

n .
,
e

per cent only instead o f two per cent Wherever money is

. .

received by tale therefore and not by weight a seignorage is

, , ,

the most e ffectual preventative o f the melting down o f the coin ,

M t m ii t i l S ig g p 4 89 p
’

D it i
'

1
See d e o na z re es o n n o z es , o ar c e e n eur a e, ar
M Ab t d B zi g h ill C mi i
. .

,
.

o C e a l Cn d Men , a o n se er -
o ss a r e en a o ur es o n n O I es
P i
.

ar s .
 T r ea t i e s of C o m m e r c e 5 I

and for the same reason of its exportation It is the best a d

, ,
. n

heaviest pieces that are commonly either melted down o r

exported ; because it is upon such that the largest profits are
made .

The law fo the encouragement of the coinage by rendering

r ,

it duty free was first enacted during the reign f Charles II fo

-

,
o . r

a limited time ; and afterwards continued by different pro ,

lo g t i
n oa till 769 when it w as rendered perpetual The
ns , 1 ,
.

Bank o f England in order to replenish their coffers with money

, ,

are frequently obliged to carry bullion to the mint ; and it was

more for their in terest t hey probably imagined that the coinag e
, ,

should be at the expense o f the government than at their o wn .

It w probably o ut o f complaisance to this great company that

as

the government agreed to render this law perpetual Shoul d .

the custom o f weighing gold however come to be disused as , , ,

it is very likely to be o account o f its inconveniency ; shoul d n

the gold coin o f England come to be received by tale as it was ,

before the late recoinage this great company may perhaps , , ,

find that they have upon this as upon some other occasions , ,

mistaken their o wn interest not a little .

Before the late recoinage when the gold currency o f Englan d ,

was t wo per cent below it s standard weight as there w as o

.
,
n

seignorage it w t w o per cent below the value o f that quantity

,
as .

o f standard gold bullion which it ought to have contai ed n .

When this great company therefore bought gold bullion i , ,

h '

order to have it coined they were obliged to pay for it t w o p

,
er

cent more than it was worth after the coi age But if there
. n .

h d been a seignorage o f t w o per ent upon the coinage the

a c .
,

common gold curren y though two per cent below its standar d
c ,
.

weight would notwithstanding have been equal in value to the

,

quantity o f standard gold whih it ought to have contained ; c

the value of the fas hion c ompensating in this c e the diminutio as n

of the weight They would indeed have had the seignorage t o

.
'

pay which being two per cent their loss upon the whole trans
,
.
,

action would have been two per ent exactly the same but o c .
,
n

g reater than it actually w as .

If the seignorage had been five per cent and the gold currency .
,

only t w o per cent below its standard weight the bank would in
.
,

this case have gained thr ee per ent upon the price o f t h c . e

bullion but as they would have had a se gnorage o f five p er

,
i

cent to pay upon the coinage their 105 5 upon the whole t ra s;
.
,
n

action would in the same manner have been exactly two p er

, ,

cent .
5 2 T he W e al t h of N a t i o n s
If the seignorage had been only per cent and the gold o ne .

currency two per ent below its sta ndard weight the bank would
c .
,

in this case have lost only per ent upon the price of the o ne c .

bullion ; but as they would likewise have had a seignorage o f e on

p e cent
r to pay their 10
. upon the whole
,
transaction would have
55

been exactly t w per ent i the same manner as in all other

o c . n

c ases .

If there was a reasonable seignorage while at the same time ,

the coin ontained its full standard weight as it has done very
c ,

n early since the late recoinage whatever the bank might lose ,

by the seignorage they would gain upon the price o f the bullion ;
,

an d whatever they might gain upon the price of the bullion they ,

would lose by the seignorage They would neither lose nor gain .
,

therefore upon the whole transaction and they would in this

, , ,

a s in all the foregoing c ases be exa tly in the same situation ,

c

as if there was no seignorage .

When the tax upon a co mmodity is so moderate as not to

e ncourage smuggling the merchant who deals in it though he , ,

a dvan es does c o t properly pay the tax as he gets it ba k in

,
n ,
c

the price o f the commodity The tax is finally paid by the last .

purchaser o consumer But money is a commodity with regard

r .

t o which every man is a mer hant N obody buys it but in c .

o rder to sell it again ; and with regard to it there s i ordinary I n

c ases no last pur c haser r consumer When the tax upon oin o . c

a
g therefore
e, is so moderate as not to en c ourage false coining

th i
, ,

ig
oh everybody advan es the tax nobody finally pays it ; c ,

because everybody gets it ba k in the advanced value f the c o

co m .

A moderate seignorage therefore would not in any case , ,

a ugment the expense o f the bank o o f any other private persons ,

r

w ho carry their bullion to the mint in order to be coined and ,

the want o f a moderate seignorage does o t in any case diminish n

it Whether there is o is not a seignorage if the currency

. r ,

c ontains its full standard weight the coinage costs nothing to ,

a nybody and if it is short f that weight the coinage must

,
o ,

always c ost the differen e between the quantity o f bullion which c

o ught to be contained in it and that which actually is contained ,

in it .

The government therefore when it defrays the expense o f

, ,

c oinage not only incurs some small expense but loses some
, ,

small revenue which it might get by a proper duty ; and neither

t he bank o any other private persons are in the smallest degree
n r

b enefited by this useless piece o f public generosity .

 T r e a t i e s of C o m m er c e 53
The dire tors f the bank however would probably be u n
c o , ,

willing to agree to the i mposition f a seignorage upon t he o

authority f a speculation which promises the m no gain but

o ,

only pretends to insure them from any loss In the present .

state f the gold oin and as long as it ontinues to be received

o c ,
c

by weight they certainly would gain nothing by su h a change

,
c .

But if the custom o f weighing the gold coin should ever go into
misuse as it is very likely to d o and if the gold c oin should ever
, ,

fall into the same state of degradation in which it was before t he

late recoinage the gain o r more properly the savings of t he
, ,

bank in o sequence of the imposition of a seignorage woul d

,
c n ,

probably be very considerable The Bank of England is t he .

only company which sends any considerable quantity of bullion

to the mint and the burden o f the annual oinage falls entirely
,
c ,

o r a lmost entirely upon it If this annual coinage had nothing

,
.

to do but to repair the unavoidable losses and ne c essary wear

and tear o f the coin it could seldom ex eed fifty thousand o r
,
c

at most a hundred thousand pounds But when the coin is .

degraded below its sta ndard weight the annual coinage must , ,

besides this fill up the large vacuities which exportation and

,

the melting p o t are continually making in the current coin It .

w as upon this a ount that during the ten or twelve years

cc

immediately preceding the late reformation of the gold oin c ,

the annual oinage amounted at an average to more than eight

c

hundred and fifty thousand pounds But if there had been a .

s egi age of four

no r five per cent upon the gold coin it would
or .
,

probably even in the state in which things then were have put
, ,

an effe tual stop to the business both f exportation and o f t he

c o

melting pot The bank instead o f losing every year about t w o

.
,

and a half per ent upon the bullion which was to be oined into
c . c

more than eight hundred and fifty thousand pounds or incurring

—
,

an annual 10 of more than twenty one thousand two hundred

55

and fifty pounds would not probably have incurred the tenth
,

part f that loss

o .

The revenue allotted b y parliament for defraying the expens e

of the oinage is but fourteen thousand pounds a year and t he
c ,

real expense whi h it costs the government c the fees o f t he ,

or

o fli e
c rs f the mint do not upon ordinary oc asions I m
o ,
c ,
a

assured ex eed the half f that sum The saving f so very

,
c o . o

small a um even the gaining o f another whi h could t

s ,
or c no

well be much larger are objects too inconsiderable it may be , ,

thought t deserve the serious attention Of government B ut

,
o .

the saving of eighteen o r twenty tho usand pounds a year in case

 54 Th e W eal t h of N at i o n s
o f an event which is not improbable whi h has frequently ,
c

happened before and which is very likely to happen again is

, ,

s urely an object which well deserves the serious attention even

o f so great a company as the Bank o f England .

Some o f the foregoing reasonings and obse vations might r

p erhaps have been more properly placed in those chapters f the o

first book which treat o f the origin and use o f money and o f the ,

d ifference between the real and the nominal price of commodities .

But as the law for the encouragement o f coinage derives i ts

o rigin from those vulgar prejudices which have been introduced

b y the mercantile system I judged it more proper to rese rve

,

t hem for this chapter N othing could be more agreeable to the

.

S pirit of that system than a sort of bounty upon the production

o f money the very thing whi c h it supposes constitutes the

, , ,

w ealth o f every nation It is o e o f its many admirable ex

. n

e d ie t s for enriching the country

p n .

CHA P TER VII

OF L N
CO O I ES

PA R T F I R S T
0/ the Mo tio es fo r est a bli
shi
n g n ew Co lo n i
es

interest which occasioned the first settlement o f the different

T HE
European colonies in America and the West Indies was not
al together so plain and distinct as that which directed the

establishment o f those o f ancient Greece and Rome .

All the different states f ancient Greece possessed each o f

o
,

them but a very small territory and when the people in any
, ,

O e f them multiplied beyond what that territory could easily

n o

m aintain a part of them were sent in quest f a new habitation

,
o

in some remote and distant part o f the world ; the warlike

n
"

eighbours who surrounded them on all sides rendering it d iff , i

c ult for any o f them to enlarge very mu h its territory at home c .

T he colonies f the Dorians resorted chiefly to Italy and Sicily

o
,

w hich in the times preceding the foundation o f Rome were

, ,
"
inhabited by barbarous and uncivilised nations : those o f the
Ionians and Eolians the t w o other great tribes of the Greeks
, ,

t o A sia Minor and the islands o f the Egea n Sea o f which the ,

inhabitants seem at tha t t i me t o have been pretty much in the

 C olon ies 55
same state as those o f Sicily and Italy The mother city .
,

though she considered the colony as a child at all times entitled ,

to great favour and assistance and owing in return much grati ,

tude and respect yet considered it as an e mancipated child

,

over whom she pretended to claim no direct authority o r

j urisdiction The colony settled its o w n form of government
.
,

e na ted its own laws

c elected its w magistrates and made
,
o n ,

peace or war with its neighbours as an independent state which ,

had no occasion to wait for the approbation or onsent f the c o

mother city N othing can be more plain and distinct than the
.

interest which directed every such establishment .

Rome like most of the other ancient republics w s originally

, ,
a

founded upon an Agrarian law which divided the public territory

’

in a certain proportion among the different citizens w ho com

posed the state The ourse f human affairs by marriage by
. c o ,

succession and by alienation necessarily deranged this original

, ,

division and frequently threw the lands which had been

, ,

allotted for the maintenance of many di ff erent families into the ,

p ossession o f a single person T remedy this disorder for such. o ,

i t w a s supposed to be a law w s made restricting the quantity

,
a

o f l and which any citizen could possess to five hundred j ugera ,

about three hundred and fifty English acres This law h o w .

,

ever though w e read o f its having been executed upon o e o

,
n r

two occasions w a either neglected o r evaded and the inequality

,
s ,

o f fortunes went on continually increasing The greater part o f .

the citizens had no land and without it the manners and customs
,

o f those times rendered it di fficult for a freeman to maintain his

independency In the present times though a poor man has no

.
,

land of his own if he has a little sto k he may either farm the
,
c

lands of another or he may carry o some little retail trade ;

,
n

and if he has no stock he may find employment either as a

,

country labourer o as an t ific r But among the ancient ar er .

Romans the lands of the rich were all cultivated by slaves who ,

wrought under an overseer who was likewise a slave ; so that a

poor freeman had little chance of being employed either as a
farmer as a labourer All trades and manufactures too even
or .
,

the retail trade were carried on by the slaves of the rich for the
,

benefit of their masters whose wealth authority and protection

, , ,

made it d ifliult for a poor freeman to maintain the competition

‘
c

citi ens therefore wh had no land had

z , ,
o ,
5 6 The W eal t h of N a t i o n s
great put them in mind of the ancient division of lands and
, ,

represented that law which restricted this sort o f private pro

perty as the fundamental law o f the republic The people .

became clamorous to get land and the rich and the great w e , ,

may believe were perfectly determined not to give them any

,

part of theirs To satisfy them in some measure therefore they

.
, ,

frequently proposed to send o ut a new colony But conquering .

Rome w a even upon such occasions under no necessity o f

s, ,

turning out her citizens to seek their fortune if one may say so , ,

through the wide world without knowing where they were to ,

settle She assigned them lands generally in the conquered

.

provinces o f Italy where being within the dominions of the

, ,

republic they could never form any independent state ; but

,

were at best but a sort o f corporation which though it had t he , ,

power o f enacti n g bye laws for its o wn government w a s at al l

-

times subj ect to the correction jurisdiction and l egisl ative , ,

authority of the mother city The sending o ut a colony o f this .

kind not only gave some satisfaction to the people but ofte n ,

established a sort o f garrison t o o in a newly conquered province , , ,

o f which the obedience might otherwise have been doubtful .

A Roman colony therefore whether we consider the na t ure of ,

the establishment itself o the motives fo making it w a s alto r r ,

gether different from a Greek o e The words accordingly n .

,

which in the original languages denote those different establish

ments have very different meanings The Latin word (C l i )
,
. o on a

signifies simply a plantation The Greek word ( m ) o n . an e ia

,

the contrary signifies a separation of dwelling a departure

, ,

from home a go ing o u t f the house But though the Roman

,
o .
,

colonies were in many respects different from the Greek ones ,

the i terest which prompted to establish them was equally plain

n

and distinct Both institutions derived their origin either from

.

irresistible necessity o fro m clear and evident utility

,
r .

The establishment o f the European colonies in America and

the West Indies arose from no necessity and though the utility :

whi h has resulted from them has been very great it is n o r

c ,

altogether so clear and evident It was not understood at their .

first establishment and was o t the motive either o f that

,
n

establishment or o f the discoveries which gave occasion to it ,

and the nature extent and limits o f that utility are not
, , ,

perhaps well understood at this day

,
.

The Venetians duri g the fourteenth and fifteenth centuries

,
n ,

carried o a very advantageous commerce in spiceries and

n ,

other East India goods which they distributed among the other
,
 Co l o n i e s 57
nations o f Europe They purchased them chiefly in Egypt at
.
,

that time under the dominion of the Mamelukes the enemies ,

o f the Turks f whom the Venetians were the enemies ; and

o -

this union f interest assisted by the money f Venice formed

o ,
o ,

su c h a connection as gave the Venetians almost a monopoly

o f the trade .

The great profits f the Venetians tempted the avidity f the

o o

Portuguese They had been endeavouring during the course

.
,

o f the fifteenth century to find u t by sea a way to the countries

,
o

from which the Moors brought them ivo y and gold dust across r

the des rt They discovered the Madeiras the Canaries the

e .
, ,

Az ores the Cape de Verde Islands the coast f Guinea that o f

,
”

,
o ,

Loango Congo Angola and Benguela and finally the Cape o f

, , , , , ,

Good Hope They had long wished to share in the profitable

.

traffic of the Venetians and this last dis c ove ry opened to them
,

a probable prospect f doing so I 4 9 7 Vasco de Gama ailed

o . n 1 , s

from the port of Lisbon with a fleet of four ships and after a ,

navigation f eleven months arrived upon the coast of Indosta n

o
,

and thus completed a course o f discoveries whi h had been c

pursued with great stead iness and with very little interruption , ,

fo nearly a century together

r .

Some years before this while the expe tations o f Europe were ,
c

in suspense about the proj ects o f the Portuguese f which the ,

o

success appeared yet to be doubtful a Genoese pilot formed the ,

yet more daring project f sailing to the East Indies by the o

West The situat on o f those countries was at that time very

. i

imperfectly known in Europe The few European travellers .

w h had been there had m agnified the distance perhaps through

o ,

simplicity and ignorance what was really very great appeari g , n

almost infinite to those w h could not measure it ; or perhaps o , ,

i n order to increase somewhat more the m arvellous f their wn o o

adventures in visitin g regions so immensely remote from Europe .

The longer the w ay was by the East Columbus very j ustly ,

the shorter it would be by the West He proposed .

,

t herefore to take that way as both the shortest and the surest
, , ,
a d he had the good fortune to convince Isabella
n f Ca stile o f o

th e probability of his proj ect He sailed from the port f . o

Palos in August 4 9 nearly five years before the expedition o f
1 2,

Vasco de Gama set o u t from Portugal and after a voyage of , ,

between two and three months discovered first some o f the small ,

Bahama or Lucayan islands and afterwards the great island of ,

St Domingo
. .

But the countries which Columbus discovered either in this ,

11 c
5 8 Th e W eal t h of N at i o n s
or in any of his subsequent voyages had no rese mblance to ,

those which he had gone in quest o f Instead o f the wealth .

,

cultivation and populousness f China and Indostan he found

,
o , ,

in St Domingo and in all the other parts f the new world

.
,
o

which he ever visited nothing but a country quite covered with ,

wood uncultivated and inhabited only by some tribes o f naked

, ,

and miserable savages He was not very willing however to .

, ,

believe that they were not the same with some o f the countries
described by Marco Polo the first European who had visited o r , ,

at least had left behind him any description of China o r the ,

East Indies ; and a very slight resemblance such as that which ,

he found between the name of Cibao a mountain in St Domingo , .

,

and that of Cipango mentioned by Marco Polo was frequently ,

sufli cie t to make him return to this favourite prepossession

‘
n ,

though contrary t o the clearest evidence In his letters to .

Ferdinand and Isabella he called the countries which he had

discovered the Indies He entertained no doubt but that they .

were the extremi t y o f those which had been described by Marco

P010 and that they were not very dista nt from the Ganges o r
, ,

from the countries which had been conquered by A lexander .

Even when at last convi ced that they were different he still n ,

flattered himself that those rich countries were at no great

distan e and in a subsequent voyage a ordingly went in
c , , ,
cc ,

quest of them along the coast o f Terra Firma and towards the ,

Isthmus of Darien .

In consequence o f this mistake o f Columbus the name o f t he ,

Indies has stu k to those unfortunate countries ever since ; and

c

when it was at last clearly dis c overed that the new were alto
gether different from the old Indies the form er were called the ,

West in contradistin tion to the latter which were called the

,
c ,

East Indies .

It was f importan e to Columbus however that the countrie s

o c , ,

whi h he had dis overed whatever they were should be ep e

c c , ,
r r

sented to the court f Spain as f very great consequence ; ando o ,

in what onstitutes the real riches of eve y country the animal

c r ,

and vegetable productions of the soil there was at that time ,

nothing whi h could well justify such a representation of them

c .

The Cori something between a rat and a rabbit and sup

, ,

posed by Mr Bu ff on to be the same with the Aperea of Brazil

.
,

was the largest viviparous quadruped in St Domingo This . .

S pecies seems never to have been very nu merous and the dogs ,

and ats o f the Spaniards are said to h v e lo ago almost

entirely extirpated it as well as some other trig
c a n

es o f a sti ll ,
 C ol o n i es 9
smaller size These however together with a pretty large
.
, ,

lizard ca lled the Ivana or Iguana constit uted the principal

, , ,

part o f the animal food which the land fl o d ed a r .

The vegetable food o f the inhabitants though from thei r ,

want o f industr y not very abundant w as not al together so ,

scanty It consisted in Indian corn yams potatoes bananas

.
, , , ,

etc plants which were then altogether unknown i Europe and

. n ,

whih have never since been very much esteemed in it o sup

c ,
r

posed to yield a sustenance equal to what is drawn from t he

common sorts of grain and pulse whi h have been cultivated ,
c

in this part o f the world time out of mind .

The cotton plant indeed afforded the material f a very

, ,
o

important manufacture and was at that time to Europea ns,

undoubtedl y the most valuable o f all the vegetable productions

o f those is lands But though in the end of the fifteenth centu ry
.

the muslins and other cotton goods o f the East Indies were
much esteemed in every part o f Europe the cotton manufa ture , c

itself was not cultivated in an y part o f it Even this production .

,

therefore could not at that time appear in the eyes of European

,
s

t o be of very great consequence .

Finding nothin g either in the an imals o r yeget a b le of t he s

newly discovered coun t ries which could justify a ve y ady a r h

t ageo u s representation of them Columbus turned his View ,

t owards the ir mineral s ; and in the richness o f the production s

o f this thi rd kingdom he flattered himself he had found a fu ll
,

compensation fo the isign ifica c y o f those o f the other two

r n n .

The little bits o f gold with which the inhabitants ornamented

,

their dress and whi h he was informed they frequently found

,
c , ,

in the rivulets and torrents that fell from the m ountain s were ,

s ufli i e t to satisfy him that those mounta ins abounded with

c n

the richest gold m ines St Dom ingo therefore was p e . .

, , re r

sented as a country aboundin g with gold and upon that , ,

account (according to the prejudi es not only o f the present c

times but o f those times ) an inexhaustible source o f real wealth

,

to the crown and kin gdom o f Spai When Columbus upon n .

,

his return from his first voyage w as introduced with a sort o f ,

triumphal honours t o t he sovereigns of Ca tile and Arra on t he s g

,

prin c ipal productions of the countries which he had discovered

were carried i so hn e procession before him The only valu
n n .

able part o f th em consisted in some little fillets bracelets and , ,

other ornaments o f gold and in some bales of c otton The , .

rest were mere objects o f vu lgar wonder and curiosity ; some

reeds of an extraordinary size some birds o f a very beautifu l ,
'
 60 The W e al t h of N a t i o n s
plumage and some stu ffed skins o f the huge alligator and
,

manati ; all o f whi h were preceded by six o r seven o f the

c

wretched natives whose singular colour and appearan e added

,
c

greatly t o the novelty o f the show .

In onsequen e o f the representations f Columbus the

c c o ,

council o f Castile determined to take possession f countries o f o

which the inhabitants were plainly incapable o f defending them

s elves The pious purpose o f converting them to Christianity
.

sanctified the injustice o f the project But the hope f finding . o

t reasures o f gold there was the sole motive whi h prompted him c

to undertake it ; and to give this motive the greater weight it ,

w a proposed by Columbus that the half o f all the gold and

s

s ilver that should be found there should belong to the crown .

This proposal was approved f by the council o .

As long as the whole o r the far greater part o f the gold ,

w hich the first adventurers imported into Europe wa s go t by ,

s o very easy a method as the plundering of the defenceless

natives it was not perhaps very difficult to pay even this heavy
,

tax But when the natives were once fairly stripped of all that
.

t hey had which in St Domingo and in all the other countries

, ,
.
,

d iscovered by Columbus w s done completely in six or eight ,

a

y ears and
,
when in order to find more it had become necessary
t o dig f it in the mine s there w as no longer any possibility of
or ,

paying this tax The rigorous exaction o f it a ordingly first

.
,
cc ,

o ccasioned it is said the total abandoning o f the mines o f St

, , .

Domingo which have never been wrought since It was soon

,
.

redu c ed therefore to a third ; then to a fifth ; afterwards to a

t enth ; and at last to a twentieth part o f the gross produce o f
t he gold mines The tax upon silver continued for a long time
.

to be a fifth o f the gross produce It wa s reduced to a tenth .

o nly in the course of the present century But the first a d en . v

tu rers do not appear to have been mu h interested about silver c .

N othing less pre ious than gold seemed worthy o f their attention
c .

All the other enterprises o f the Spaniards in the new world ,

subsequent to those o f Columbus seem to have been prompted ,

by the same motive It was the sa red thirst o f gold that

. c

c arried Oieda N i c u essa and Vasco Nug es de Balboa to the

, ,
n ,

Isthmus o f Darien that carried Cortez to Mexico and Almagro

, ,

a d Pi a
n o to Chili and Peru When those adventurers
zz rr .

a rrived upon any unknown coast their first inquiry w as a l ways ,

if there was any gold t o be found there ; and according to the

information which they received concerning this particular they ,

d etermine d eithe r t o quit the country o r to set t le in it .

 C o l o n i es 6I
O f all those expensive and uncertain projects however which , ,

bring bankruptcy upon the greater part of the people w ho

engage in them there is none perha ps more perfectly ruinou
,
s

than the search after new silver and gold mines It is perhap s .

the most disadvantageous lottery in the world o the o e i ,

r n n

which the gain of those who draw the prizes bears t he

least proportion to the loss o f those w ho draw the blanks :
fo r though the prizes are few and the blanks many t he ,

common price o f a ticket is the whole fortune of a very rich

man Proje ts o f mining instead of replacing the apital em
. c ,
c

ployed in them together with the ordinary profits o f stock

, ,

commonly absorb both capital and profit They are the pro .

j ec t s,
therefore to which o f all
,
others a prudent lawgiver w h o ,

desired to in rease the capital of his nation would least choos e

c ,

t o give any extraordinary encouragement o to turn toward s ,

r

them a greater share of that capital than what would go t o

them o f its own accord Such in reality is the absurd c o fi
. n

dence which almost all men have in their o w good fortun e n

that wherever there is the least probability o f success too great

, ,

a share f it is apt to go to them o f its o wn accord

o .

But though the judgment of sober reason and experience

concerning such projects has always been extremely unfavour
able that o f human avidity has commonly been quite otherwise
,
.

The same passion which has suggested to so many people t he

absurd idea of the philosopher s stone has suggested to others ’
,

the equally absurd o e o f immense rich mines of gold and silver

n .

They did o t consider that the value o f those metals has in all
n ,

ages and nations arisen chiefly from their scarcity and that
, ,

their scarcity has arisen from the very small quantities o f the m
which nature has anywhere deposited in o e pla e from t he n c ,

hard and intractable substances with which she has almost

everywhere surrounded those small quantities and con sequently ,

from the labour and expense which are everywhere necessary in

order to penetrate to and get at them They flattered them .

selves that veins o f those meta ls might in many places be found

as large and as abundant as those which are commonly found
o f lead or copper or tin o iron The dream of Sir Walte
, , ,
r . r

Raleigh concerning the golden city and country of Eldorado ,

may satisfy us that even wise men are not always exempt fro m
such strange delusions More than a hundred years after t he
.

death o f that great man the Jesuit Gumila w as still convin e d

,
c

o f the reality o f that wonderful country and express ed with ,

great warmth and I dare t o say with great sin c erity ho w

, ,
62 The W eal t h o f N at i o n s
h appy he should be to car y the light o f the gospel to a people
r

w ho could so well reward the pious labours o f their m issionary .

In the countries first discovered by the Spaniards no gold o r ,

silver mines are at present known which are supposed to be

worth the working The quantities o f those metals which the
.

first adventurers are said to have found there had probably

been very much magnified as well as the fertility of the mines ,

which were wrought immediately after the first discovery .

What those adventurers were reported to have found however , ,

was uflic i t to inflame the avidity of all their countrymen

s en .

Every Spaniard who sailed to Ameri a expe c ted to find an c

Eldorado Fortune too did upon this what she has done upon
.
, ,

very few other occasions She realised in some measure the .

e xtravagant hopes f her votaries and in the discovery and

o ,

c onquest o f Mexico and Peru of which the o happened about

( ne

thirty the other about forty years after the first expedition o f
,

Columbus ) she presented them with something not very unlike

,

that profusion of the precious metals which they sought fo r .

A proj ect f com merce to the East Indies therefore gave

o , ,

o ccasion to the first discovery o f the West A project f c o n . o

q uest gave occasion to all the establishments o f the Spaniards

in those newly discovered countries The motive which excited .

them to this conquest w a proj ect o f gold and silver mines ;

as

a d a course o f accidents which no human wisdom could foresee

n ,
,

rendered this proj ect much more successful than the under
takers had any reasonable grounds fo expecting r .

The first adventurers f all the other nations o f Europe who

o

atte mpted to make settlements in America were animated by

the like chimerical views ; but they were not equally successful .

It was more than a hundred years after the first settlement o f

the Brazils before any silver gold o diamond mines were dis , ,
r

c overed there In the English French Dutch and Dan sh

.
, , ,
i

colonies none have ever yet been discovered ; at least none

,

that are at present supposed to be worth the working The .

first English settlers in N orth America however o ffered a fifth , ,

o f all the gold and silver whi h should be found there t o the c

king as a motive for granting them their patents In the

,
.

patents to Sir Walter Raleigh t the London and Plymouth ,

o

companies to the council of Plymouth etc this fifth was

, ,
.
,

accordingly rese ved to the crown To the expectation o f

r .

finding gold and silver mines those first settlers too j o ned , , ,
i

that o f discovering a north west passage to the East Ind ies -

.

They have hitherto been disappointed in both .

 C ol o n i es 63

PA RT . S E CON D

C a us es f the P r osper i f N ew C o lo n i
‘

o ty o es

THE colony o f a civilised nation whi c h takes possession either

o f a waste country , o r o f one so thinly inhabited that the natives
easily give place to the new settlers advances more rapidly t o ,

wealth and greatness than any other human society .

The colonists carry o u t with them a knowledge o f agriculture

and o f other useful arts superior to what can grow up f its o

o w accord in the course o f many centuries among savage and

n

barbarou s nations They carry out with them too the habit
.
, ,

o f subordination some notion of the regular government which

,

takes place in their o w country o f the system o f laws which

n ,

support it and o f a regular administration f justice ; and they

,
o

naturally establish something of the same kind in the new settle

ment But among savage and barbarous n ations the natural
.
,

progress o f law and government is still slower than the natural

progress of arts after law and govern ment have been so far
,

established as is necessary for their protection Every colonist .

gets more land than he can possibly cultivate He has no rent .

,

and scarce any taxes to pay N o landlord shares with him in .

its produce and the share f the sovereign is commonly but a

,
o

trifle He has every motive to render as great as possible a

.

produce which is thus to be almost entirely his own But his

,
.

land is c ommonly so extensive that with all his o w industry ,

n ,

and with all the industry f other people whom he can get to o

employ he can seldom make it produce the tenth part o f what

,

it is capable of producing He is eager therefore to colle t .

, ,
c

labourers from all quarters and to reward them with the most ,

liberal wages But those liberal wages j oined to the plenty and
.
,

cheapness of land soon make t h l b o u e leave him in order

,
o se
'

a r rs ,

to become landlords themselves and t reward with equal ,

o ,

liberality other labourers who soon leave the m for the same
, ,

reason that they left their first m aster The liberal reward f . o

labour en c ourages marriage The children during the tender .

,

years of infan y are well fed and properly taken care f and
c , o ,

when they are grown up the value of their labour greatly over
,

pays their maintenance When arrived at maturity the high

.
,

pr ce of labour and the lo w price f land enable them to

i ,
o ,

e stablish themselves in the same manner as their fathe rs did

before them .

In other countries rent and profit eat up wages and the two
, ,
 64 Th e W eal t h of N at i o n s
superior or d ers of people Oppress the inferior one But in new .

colonies the interest f the two superior orders obliges them to

o

treat the inferior one with more generosity and humanity ; at

least where that inferior o is not in a state of slavery Waste ne .

lands of the greatest natural fertility are to be had for a trifle .

The increase o f revenue which the proprietor who is always the ,

u ndertaker expects from their improvement

,
constitutes his ,

profit which in these circumstances is commonly very great .

But this great profit cannot be made without employing the

labour f other people in clearing and cultivating the land ; and
o

the disproportion between the great extent of the land and the
small number o f the people which commonly takes place in new ,

colonies makes it di fficult fo r him to get this labour He does

, .

not therefore dispute about wages but is willing to employ

, , ,

labour at any price The high wages of labour encourage

.

population The cheapness and plenty o f good land encourage

.

improvement and enable the proprietor to pay those high wages

,
.

In those wages consists almost the whole price o f the land ; and
though they are high considered as the wages o f labour they ,

are low considered as the price o f what is o ve y valuable s r .

What encourages the progress of population and improvement

encourages that of real wealth and greatness .

The progress o f many o f the ancient Greek colonies towards

wealth and greatness seems accordingly to have been very
rapid In the course of a century o r two several of them appear
.
,

to have rivalled and even to have surpassed their mother cities

,
.

Syracuse and Ag ige t um in Sicily Tarentum and Locri in Italy

r n , ,

Ephesus and Miletus in Lesser Asia appear by all accounts to ,

have been at least equal to any of the cities o f ancient Greece .

Though posterior in their establishment yet all the arts o f ,

refinement philosophy poetry and eloquence seem to have

, , ,

been cultivated as early and to have been improved as highly

,

in them as in any part f the mother country The schools o f

o .

the two oldest Greek philosophers those of Thales and Pyt h ,

a

goras were established it is remarkable n t in ancient Greece

, , ,
o ,

but the e in an Asiati c the other in an Italian colony All

on ,
.

those c olonies had established themselves in countries i n habited

by savage and barbarous nations who easily gave place to the ,

new settlers They had plenty of good land and they were
.
,
as

altogether independent of the mother city they were at liberty ,

to manage their own affairs in the w ay that they judged was

most suitable to their own interest .

The history o f the Roman colonies is by no means so br ill iant .

 C o lo n i es 65
S ome o f them indeed such as Florence have in the course o f
, , ,

many ages and after the fall f the mother city grown up to be
,
o ,

considerable st tes B ut the progress f no e of them seem s

a . o on

ever to have been very rapid They were all established in .

conquered provinces which in most c ases had been fully ih ,

h abited before The quantity o f land as signed to each olonist

. c

w s seldom very onsiderable and as the olony w s not i

a n c ,
c a

dependent they were not always at liberty to manage their

,

o w aff airs in the way that they j udged w

n most suitable to as

their own interest .

In the plenty of good land the European colonies established ,

in Ameri a and the West Indies resemble and even greatly

c ,

s urpass those f an ient Greece In their depende cy upon

,
o c . n

the mother state they resemble th ose of an ient Rom e ; but ,

c

their great distan e from Europe has in all f them allevi ated c o

more o less the eff ects of this depende y Their situat i on

r nc .

has placed the m less in the View and less in the power of their
mother ountry In pursuing the ir interest their w way
c . o n ,

their condu t has upon many oc asions been overlooked either

c ,
c , ,

because o t known o not understood in Europe ; and upon

n r

s ome o c a ions it has been fairly su ff ered and submitted to

c s ,

because their distan e rendered it d ifli ult to restrain it Even c c .

the violent and arbitrary governm ent f Spain has upon many o ,

o cc asions been obliged to recall o soften the orders whi h had

,
r c

been given for the gover m ent Of her olonies for fear of a n c

g eneral insurre tion The progress o f all the European

c olonies . c

in wealth population and improvement has ac ordingly been

, , ,
c

very great .

The rown f Spain by its share o f the gold and silver derived
c o , ,

s ome revenue fro m its colonies from the mo m ent of their first

e stablishment It w as a revenue too f a nature to excite in

.
, ,
o

hu man avidity the most extravagant expe tations of still greater c

ri hes The Spanish olonies therefore from the m oment o f

c . c , ,

their first establishment attra ted very much the attention o f ,

c

their m ther ountry while those o f the other European nations

o c ,

were for a long time in a great measure neglected The form er .

di d ot perhaps th ive the better i onsequence f this

n , ,
r n c o

a ttention ; o the latter the worse in consequen e f this

n r c o

negle t In proportion t the extent of the ountry whi h they

c . o c c

in me measure possess the Spa ish olonies

so considered as ,
n c a re

less populous and th iving than those f almost any other r o

European nation The progress even o f the Spanish olonies . . c ,

however in population and improvement has certainly been

, ,

II C 2
66 Th e W e al t h of N at i o n s
very rapid and very great The city of Lima founded since t he .
,

conquest is represented by Ulloa as containing fifty thousand

,

inhabitants near thirty years ago Quito which had been but .
,

a miserable hamlet o f Indians is represented by the same author ,

as in his time equally populous Gemelli C e i a pretended . arr r ,

traveller it is said indeed but who seems everywhere to hav e

, , ,

written upon extremely good information represents the ci t y of ,

M exi c o as ontaining a hundred thousand inhabitants ; a nu mbe r

c

which in S pite f all the exaggerations o f the Spanish writers

,
o ,

is probably more than five times greater than what it ontained

, ,
c

in the time of Montezuma These numbe rs exceed greatly those .

o f Boston N ew York and Philadelphia the three greatest ities

, , ,
c

o f the English colonies Before the conquest o f the Spaniards

.

there were no attle fit fo draught either in Mexico or Peru

c r .

The lama was their only beast of burden and its strength seems ,

to have been a good deal inferior to that o f a common ass The .

plough was unknown among them They were ignorant of the .

use o f iron They had no coined money o r any established

.
,
n

instrument o f commer e o f any kind Their ommerce was c . c

carried by barter A sort f wooden S pade was their princ ipal

on . o

instrument of agri ulture Sharp stones served them for knives

c .

and hatchets to c ut with ; fish bones and the hard sinews o f

certain animals served them for needles to sew with ; and these
seem to have been their principal instru ment of trade In s .

this state f things it seems impossible that either of those

o ,

empires ould have been so much improved or so well cultivated

c

as at present when they are plentifully furnished with all sorts

,

o f European attle and when the use of iron o f the plough and
c , , ,

o f many of the arts o f Europe has been introduced among them ,

;

But the populousness o f every country must be in proportion to

the degree of its improvement and cultivation In spite of the .

cruel destru tion of the natives whi h followed the conquest

c c ,

these two great empires are probably m ore populous w than , ,

no

they ever were before and the people are surely very different ;
:

fo we must acknowledge I apprehend that the Spanish creole s

r , ,

are in many respects superior to the an ient Indians c .

After the settle ments o f the Spaniards that of the Portuguese ,

in Brazil is the oldest o f any European nation in Ameri c a But .

as for a long time after the first discovery neither gold nor
silver mines were found in it and as it afforded upon that , ,

a count little o r no revenue to the rown it wa for a long time

c ,
c ,
s

in a great measure neglected ; and during this sta te of neglect

it grew up to be a great and powerful colony While Portugal .
 C o lo n i es 67
was under the dom inion o f Spain Brazil was attacked by t he ,

Dutch who got possession of seven f the fourteen provinces

,
o

into which it is divided They expe ted soon to onquer t he . c c

other seven when Portugal recovered its independen y by the

,
c

elevation f the family o f Braganza to the thr one The Dutch

o .

then as enemies to the Spaniards became friends to the Port u

, ,

e w ho were likewise the enemies o f the Spaniards They

g u s e ,
.

agreed therefore to leave that part of Bra il which they had

, ,
z ,

n o t conquered to the King of Portugal who a reed to leave

, ,
g

that part which they had onquered to them as a matter o t c ,

n

worth disputing a bout with such good allies But the Dutch .

g vo rnn i
ee t soon began tonoppress the Portuguese olonists c
,

w ho instead o f amusing themselves with omplaints took arms

,
c ,

against their new masters and by their o w valour and resolu ,

n

tion with the c onnivance indeed but without any avowed

, , ,

ass istan e from the mother country drove them u t o f Brazil

c ,
o .

The Dutch therefore finding it impossible to keep any part

, ,
.

o f the country t themselves were contented that it should be

o ,

entirely restored t o the rown f Portugal In this olony there c o . c

are said to be more than six hundred thousand people eithe , r

Portugu ese des ended from Portu guese reoles mulattoes

or c ,
c , ,

and a mixed race b t w ee Portuguese and Braz ilians N o o e

e e n . n

colony in Am eric a is supposed to contain 0 great a number o f 5

people o f European extra tion c .

Towards the end of the fifteenth and during the greater part ,

o f the sixteenth centu y Spain and Por t ugal were the two great
r ,

naval powers upon the o ean ; for though the ommer e f c c c o

Veni e extended to every part of Europe its fleets had s arce
c , c

ever sailed beyond the Mediterranean The Spaniards i vi tue .

,
n r

of the first dis overy laim ed all Ameri a as their w ; and

c ,
c c o n

though they ould not hinder so great a naval power as that

c

o f Portugal from settling in Brazil su h was at that time the ,

c , ,

terror f their name that the greater part f the other nations
o ,
o

o f Europe were afraid to establish the m selves in any other part

o f that great continent The Fren h who attempted to settle. c ,

in Florida were all murdered by the Spaniards But the de

, .

c le si n f the naval power f this latter nation in onsequence

on o o ,
c
o f the defeat m iscar iage f what they alled their Invin cible
or r o c

Ar mada whi h happened towards the end f the sixteenth

,
c o

century put it out of their power to obstru t any longer the

, c

settlements of the other European nations In the co urse of .

the seventeenth entu y therefore the English French Dutch

c r , , , , ,

Dan es and Swedes all the great nations who had any p orts
, ,
 68 Th e W e al t h o f N a t i o n s
pon the o ean a ttempted to make some settlements in the new
u c ,

w orld .

The Swedes e tablished themselves in N ew Jersey ; and the

s

u mber f Swedish families still t o be found there su ffic iently

n o

d e m onstrates that this colony was very likely to prosper had

it been prote ted by the mother country c But being negle ted . c

b y Sweden it w soon swallowed up by the Dutch olony of

,
as c

N ew York whi h again in 674 fell under the dominion f the

,
c ,
1 , o

E glishn .

The s mall islands o f St Thomas and Santa Cruz are the only .

c ountries in t h w world that have ever been possessed by

e ne

the Danes These little settlements t o o were under the govern

.
, ,

ment o ian ex lusive company whi h had the sole right both
-
c ,
c ,

o f purchasing the surplus produce o f the colonists and o f supply ,

i g them with su h goods o f other countries as they wanted

n c
,

a d which therefore both in its purchases and sales had n o t

n , , ,

only the power f Oppressing them but the greatest temptation

o ,

t o do so The government o f an exclusive company of mer hants

. c

i perhaps the worst o f all governments for any country what

s, ,

ever I t was not however able to stop altogether the progres s

.
, ,

o f these olonies though it rendered it more slow and la guid

c ,
n .

The late Ki g of Denmark dissolved this ompany and sin e

n c ,
c

that time the prosperity o f these colonies has been very great .

The Dut h settlements in the West as well as those in the

c ,

East Indies were originally put under the government o f an

,

e xclusive company The progress f some o f the m therefore . o , ,

t hough it has been onsiderable in c omparison with that o f c ,

a lmost any ountry that has been long peopled and established
c ,

h been l anguid and slow in omparison with that of the greater

as c

part f new olonies The olony of Surinam though very

o c . c ,

c onsiderable is s t ill inferior to the greater part f the sugar

,
o

c olonies f the other European nations The colony o f N ova

o .

«
B lgi now divided into the two provinces o f N ew York and
e a,

N ew Jersey would probably have soon beco me onsiderable too

,
c ,

e ven though it had remained under the government of the Dutch .

The plenty and heapness o f good land are su h powerful c auses

c c

o f prosperity that the very worst govern ment is scar e apable c c

o f checking altogether the effi acy o f their Operation The great c .

distan e too from the mother country would enable the olonists
c , ,
c

to evade more o less by s muggling the monopoly which the r , ,

c ompany enjoyed against the m At present the company .

a llows all Dutch ships to trade to Surinam upon paying two

a d a half per cent upon the value of their cargo for a licence ;
n .
 C o l o n i es 69
and only reserves to itself exclusively t he direct trade fro m
Africa to America which consists almost entirely in the slav e,

trade This relaxation in the exc lusive privileges o f the com

.

pany is probably the prin ipal cause of that degr ee o f prosperity c

which that colony at present enjoys Curaco a an d Eu t a t i t h e . s a,

t wo prin ipal islands b elonging to the Dutch are free ports ope
c ,
n.

to the ships o f all nation ; and this freedom in the midst o f s ,

b etter coloni es whose ports are open to those o f on e nation only ,

has been the great cause o f the prosperity o f t hose t w o barren :

islan ds .

The French colony of Canada was d uring the greater part o f ,

the last cen t ury and some part o f the pre sent under t he
'

, ,

government o f an exclusive company Unde r so unfavourabl e .

an administration its progress was nece ssarily very slow i n

comparison with that of other new colonies ; but it becam e

much more rapid when this company was dissolved after t h e

fall of what is called the Mississippi scheme When the Engl ish .

got possession o f this count ry they found in it near double the ,

number o f inhabitan ts which Father Charlevoix had assigned t o

it between twenty and thirty years before That Jesuit had .

t ravelled over the whole cou try and had no in lination t o n ,

c

r epresent it as less considerable than it really was .

The French colony o f St Domingo w as established by pirate . s

and freebooters who for a long time neither required the p o

, , ,
r

t ec t i
o
n, n o acknowledged the authority f France ; and whe
r o n

that ra e f banditti be ame so far citizens as to a knowledg

c o c c e

this authority it w as for a long time nece sary to exercise it

,
s

with very great gentleness Duri g this period the populatio . n n

and improvement o f this olony incre ased very fast Even t he c .

Oppression o f the exclusive ompany to which it w as for som e c ,

t ime subje c ted with all the other olonies o f Fran e though it
,
c c ,

no doubt reta rded had not been able t o stop its progress alto
,

gether The course o f its prosperity re t urned as soon as it w as

.

relieved from that oppression It is now the most important o f .

the sugar colonies f the West Indies and its produ e said t o o ,
c 15

be greater than that f all the Englis h sugar olonies p u t o c

together The other sugar colonies of France are in general all

.

very thrivi g n .

But there are no olonies o f which the progress has bee c n

more rapid than that o f the English in N orth Ameri a c .

Plenty o f good land and liberty to manage the ir o w affairs ,

n

their w w y seem to be the two great ca uses o f the prosperity

o n a ,

o f all new colonies .

7 0 The W eal t h of N at i o n s
In the plenty of good land the English colonies of N orth ‘

Ameri a though no doubt very abundantly provided are ho w

c , ,

ever inferior to those f the Spaniards and Portuguese and not o ,

s uperior to some of those possessed by the Fren h before the c

late war But the politi c al institutions f the English olonies

. o c

have been more favourable to the improvement and cultivation

o f this land than those of any of the o t h t h ee nations er r
'

First the engrossing f uncultivated land though it has by

,
o ,

no means been prevented altogether has been more restrained ,

i the English olonies than in any other

n The olony law
c . c

w hi h imposes upon every proprietor the ob ligation o f i

c m
proving and cultivating within a limited time a ertain pro , ,
c

portion o f his lands and which in case of failure de lares those , ,

c

n egle c ted lands grantable t o any other person though it has ,

n ot perhaps been very strictly executed has however had

, , , , ,

some eff e t c .

Secondly in Pennsylvania there is no right of primogeniture

, ,

and lands like movables are divided equally among all the
, ,

c hildren f the family In three f the provin es of New

o . o c

England the oldest has only a double share as in the Mosaical ,

law Though in those provinces therefore too great a quan

.
, ,

tity f land should sometimes be engrossed by a particular

o

individual it is likely in the ourse of a generation or two to

, ,
c ,

be su ffi iently divided again In the other English colonies

c .
,

indeed the right of primogeniture takes place as in the law f

, ,
o

England But in all the English c olonies the tenure of the

.

lands which are all held by free so age facilitates alienation

,
c , ,

and the grantee of any extensive tra t o f land generally finds it c

for his interest to alienate as fast as he can the greater part of , ,

it reserving only a small quit rent In the Spanish and Portu

,
-

e colonies what is c alled the right of M takes

j
1
g u es ,
o a o ra z z

pla e in the su ession of all those great estates t o which any

c cc

title f honour is annexed Such estates go all to

o person . o ne ,

a d are in e ffect entailed and unalienable

n The Fren h olonies . c c ,

indeed are subject to the custom of Paris which in the inherit

, , ,

a n e f land is mu c h more favourable to the younger children

c o ,

than the law of England But in the French olonies if any . c ,

part f an estate held by the noble tenure f hivalry and

o ,
o c

homage is alienated it is for a limited time subje t to the

, , , ,
c

r ight of rede mption either by the heir o f the superior or by the ,

heir of the family ; and all the largest estates f the ountry o c

a e held by su h noble tenures

r which necessarily embarrass
c ,

Jus Ma j o r a t u s
1
.
 C o l o n i es 7 I

alienation But in a new olony a great uncultivated estate

. c

is likely to be mu h more speedily divided by alienation than c

by suc ession The plenty and cheapness o f good land it has

c .
,

a lready been observed are the principal auses of the rapid ,

c

prosperity o f new colonies The engrossing of land in e ffect .

, ,

destroys this plenty and heapness The engrossing of u c ult i c . n

v t d land besid es is the greatest obstruction to its improve

a e , ,

ment But the labour that is e mployed in the improvement

.

a d n ultivation of land afford s the greatest and most valuable

c

produce to the society The produce o f labour in this cas e .

, ,

pays not only its o w wages and the profit o f the stock which n ,

employs it but the rent o f the land too upon whi h it is em

"

,
c

ployed The labour f the English olonists therefore be ing

. o c , ,

more employed in the improvement and cultivation f land is o ,

likely to afford a greater and more valuable produce than that

o f any f the other three nations which by the engrossing of
o , ,

land is more o less diverted towards other employments

,
r .

Thirdly the labour of the English colonists is not only likely

,

to afford a greater and more valuable produce but in c o s , ,

n e

q u e c e
n f the moderation fotheir taxes a greater propo tion o f o ,
r

this produce belongs to themselves whi h they may store up ,

c

and employ in putting into motion a still greater quantity of

labour The English olonists have never yet contributed any
. c

thing towards the defence f the mother country or towards o ,

the support of its ivil government They themselves the

c .
,
on

contrary have hitherto been defended almost entirely at the

,

expense f the mother ountry o But the expense o f fleets and c .

armies is out o f all proportion greater than the ne essary c

expense o f ivil government The expense o f their own ivil

c . c

government h always been ve y m oderate It has generally

as r .

been confined to what was ne essary for payi g competent c n

salaries to the governor to the judges and to some other officers , ,

o f police and for maintai ing a few

,
f the most useful publi c n o

works The expense of the ivil establishment o f Massa husett s

. c c
’

Bay before the commen e ment of the p e e t d it u b

,
used c r s n s r an c es ,

to be but about a year That f N ew Hampshire and . o

Rhode Island £35 00 ea h That o f Conne ticut £4 000 That

,
c . c ,
.

o f N ew York and Pennsylvania £4 5 00 ea h That of N ew ,

c .

Jersey £ 00 That o f Virginia and South Carolina £8 000 ea h

,
12 .
,
c .

The ivil esta blishment o f N ova Scotia and Georgia are partly
c

supported by an annual grant o f parliament But N ova .

S otia pays besides about £ 7000 a year towards the public

c , ,

expenses o f the c olony ; and Georgia about £ 5 00 a year All 2 .

 7 2 The W eal t h of N a t i o n s
the different civil establishments in N orth Ameri a in short c , ,

ex lusive of those of Maryland and N orth Carol ina of which o

c ,
n

exac t account has been got did not before the commence ment , ,

o f the present disturbances cost the inhabitants above

a year ; an ever memorable example at how small an expense

,
-

three millions of people may not only be governed but well ,

governed The most important part of the expense of govern

.
~

ment indeed that o f defence and protection has constantly

, , ,

fallen upon the mother country The ceremonial too o f the .

, ,

civil government in the colonies upon the re eption of a ew ,

c n

governor upon the opening o f a new assembly etc though

, ,
.
,

sufl c i e t ly de ent is not ac ompanied with any expensive pom p

f
i n c ,
c

or parade Their ecclesiastical government is onducted upon

. c

a plan equally frugal Tithes are unknown among them ; and .

their lergy who are far from being numerous are maintained
c , ,

either by moderate stipends or by the voluntary contributions ,

o f the people The power f Spain and Portugal on the con

. o ,

t ra y derives some support from the taxes levied upon their

r ,

colonies France indeed has never drawn any considerabl e

.
, ,

revenue from its colonies the taxes which it levies upon ,

.

them being generally spent among them But the olony . c

governm ent o f all these three nations is conducted upon a

much more expensive ere monial The sums spent upon t he c .

reception of a new viceroy of Peru for example have frequently , ,

been enormous Such eremonials are not only real taxes paid
. c

by the rich colonists upon those particular occasions but the y ,

s erve to introduce among them the habit o f vanity and expens e

upon all other o cas ons They are not only very grievous c i .

oc asional taxes but they ontribute to establish pe rpetual

c ,
c

taxes o f the same kind still more grievous ; the ruinous taxes
o f private luxury and extravagan e In the colonies o f all c .

those three nations too the ec lesiasti al government is ex ,

c c

t rem ly oppressive
e Tithes take place in all o f them and are .
,
'

l evied with the utmost rigour in those o f Spain and Portugal .

Al l o f them besides are oppressed with a numerous race of

, ,

mendicant friars whose beggary being not only licensed but

,

consecrated by religion is a most grievous tax upon the poor ,

people w ho are most carefully taught that it is a duty to give

, ,

an d a very great sin to refuse them their charity Over and .

above all this the clergy are in all o f them the greatest
, , ,

engrossers o f land .

Fourthly in the disposal o f their surplus produce o of

, ,
r

What is over and above their own consumption the Englis h ,

 C o l on i es 73
colonies have been more favoured and have been allowed a ,

more extensive market than those of a y other Europea,

n n

nation Every European nation has endeavoured more o les

. r s

to monopolise to itself the commerce f its colonies and upo o , ,

n

that account has prohibited the ships o f foreign nations from

,

trading to them and has prohibited them from importing

,

European goods from any foreign nat o n But the manner i . in

which this monopoly has been exercised n d i fferent nations has I

been very diff erent .

Some nations have given up the who l e commerce o f thei r

colonies to an exclusive company f whom the colonists wer e ,
o

obliged to buy all such European goods as they wanted and t o ,

whom they were obliged to sell the whole f their own surplu o s

produce It w a the interest of the co mpany therefore not

. s , ,

only to sell the former as dear and to buy the latter as cheap ,

as possible but to buy no more o f the latte even at this lo w

,
r,

p rice than w hat they could dispose o f for a very high price
i
n Europe It w a their interest not o nly to degrade in all
. s ,

cases the value of the surplus produce o f the co lony but in many ,

cases to discourage and keep down the natural increase of its

quantity O f all the expedients that c an well be contrived to
.
,

stunt the natural growth of a new colony that o f an exclusive ,

company is undoubtedly the most e ff ectual This however .

, ,

has been the policy of Holland though their company in t h , ,

e

course o f the present century has given up in many respects t h ,

e

exertion o f their exclusive pri ilege This too was the policy v .
, ,

o f Den m ark till the reign o f the late king It has occasionally .

been the policy o f France and o f late since 75 5 after it had

, ,
1 ,

been abandoned by all other nations on account o f its absurdity ,

it has become the policy of Portugal with regard at least to two

o f the prin ipal provinces of Brazil F ern a mb u c
c and Ma o ,
o ran n n .

O ther nations without establishing an exclusive company

, ,

have confined the whole commerce of their colonies to p t ic ul a ar ar

port of the mother country from whence no ship was allowed to ,

sail but either in a fleet and at a particular season or if sin gle

, , , ,

in consequence of a p ic ul licence which in most cases was

ar ar ,

very well paid for This policy Opened indeed t he trade f the
.
, ,
o

colonies to all the natives o f the mother country provided they ,

traded from the proper port at the proper season and in t he , ,

proper vessels But as all the different merchants who j oin ed

.
,

their stocks in order to fit out those licensed vessels would find ,

it for their interest to act in concert the trade which was carrie d ,

o n in this manner would necessarily be conducted ve ry nearly

 74 T he W eal t h of N at i o n s
upon the same principles as that of an exclusive o mpany The c .

profit f those mer hants would be almost equally exorbitant

o c

and oppressive The colonies would be ill supplied and would

.
,

be obliged both to buy very dear and to sell very cheap This , .
,

h owever till within these few years had always been the policy
, ,

o f Spain and the pri e of all European goods accordingly is

,
c , ,

said to have been enormous in the Spanish West Indies At .

Q uito we are
,
told by Ulloa a pound o f iron sold for about four ,

and sixpence and a pound of steel for about six and ninepence
,

sterling But it is chiefly in order to purchase European goods

.

that the colonies part with their w produce The more there o n .
,

f ore they pay for the

,
e the less they really get for the other
on , ,

and the dearness of the one is the same thing with the c heapness
o f the other The policy f Portugal is in this respect the same
. o

as the ancient policy of Spain with regard to all its colonies ,

e xcept F e amb u c and Ma a o n and with regard t o these

rn o r nn ,

i t has lately adopted a still worse .

Other nations leave the trade f their colonies free t o all their o

s ubj e ts w h o may carry it o

c from all the different ports o f the n

mother country and who have occasion fo no other licence

,
r

t han the ommon despatches o f the custom house

c In this case -

th number and dispersed situation f the different traders

e o

r enders it impossible fo t hem to enter into any general c o m r

bination and their competition is su fficient t o hinder them from

,

making very exorbitant profits Under so liberal a policy the .

colonies are enabled both to sell their own produce and to buy
the goods o f Europe at a reasonable price But sin c e the dis .

solution o f the Plymouth company when u olonies were but ,

o r c

in their infancy this has always been the poli y o f England It

,
c .

h as generally t been that f France and has been uniformly

,
oo, o ,

s o since the dissolution o f what in England is commonly called , ,

t heir Mississippi company The profits of the trade therefore .

, ,

which France and England carry on with their colonies though ,

n o doubt so mewhat higher than if the competition was free to

all other nations are however by no means exorbitant ; and the
, , ,

p rice o f European goods a cordingly is not extravagantly high c

i the greater part o f the olonies o f either o f those nations

n c .

In the exportation o f their own surplus produ e t o it is only c o ,

w ith regard to ertain commodities that the colonies o f Great

c

Britain are confined to the market f the mother country o .

These o mmodities having been enumerated in the act f

c o

n avigation and in some other subsequent acts have upon that ,

a ccount been called um t d mm diti The rest are called

en era e co o es .
 C o l o n i es 75
n o n en u
-

and may be exported directly to other countries

mer a ted
provided it is in British or Plantati on ships o f which the ow ers ,
n

and three fourths of the mariners r British subj e ts

-
a e c .

Among the non enumerated commodities are some o f the

-

most important productions f America and the West Indies ; o

grain f all sorts lumber salt provisions fish sugar and rum
o , , , , ,
.

Grain is naturally the first and principal obj ect f the cultu re o

o f all new colonies By allowing them a ve ry extensive market

.

for it the law encourages them to extend this culture much

,

beyond the c onsumption of a thinly inhabited country and thus ,

to provide beforehand an ample subsistence for a continually

increasing population .

In a country quite covered with wood where timber con ,

sequently is o f little o r no value the expense o f clearing the ,

ground is the principal obsta cle to improvement By allowing .

the c olonies a very extensive market fo their lumber the law r ,

e ndeavours to facilitate improvement by raising the price o f a

commodity which would otherwise be of little value and thereby ,

enabling them to make some profit of what would otherwise be

mere expense .

In a countr y neither half peopled nor half cultivated cattle - -

naturally multiply beyond the consumption o f the inhabitants ,

and are often upon that account f little o no value But it o r .

is necessary it has already been show that the pri e of cattle

,
n, c

should bear a certain proportion to that f corn before the o

greater part of the lands of any country c be improved B y an .

allowing to American cattle in all shapes dead and alive a , , ,

very extensive market the law endeavours to raise the value ,

o f a commodity of whi c h the high price is so very essential to

improvement The good e ff e c ts f this liberty however must

. o , ,

be so mewhat di minished by the 4 t h of Geo rge III c 5 which . . 1 ,

puts hides and skins among the enumerated commodities and ,

thereby tends to reduce the value f Americ an cattle o .

To increase the shipping and naval power o f Great Britain ,

by the ext io f the fisheries f u colonies is an object

en s n o o o r ,

which the legislature seems to have had almost ons t antly in c

view Those fisheries upon this account have had all the
.
, ,

encourage ment whi h freedom can give the m and the y have
c ,

flourished a ordingly The N ew England fishery in parti ular

cc . c

w as, before the late disturban es f the most important c ,

one o ,

perhaps in the world The whale fi he y which o t w it h t d

, .
-

s r ,
n s an

ing an extravagant bounty is in Great Britain arried on to o ,

c s

little purpose that in the Opinion of man y people (whi h I do c

 The W e al t h of N a t i o n s
not however pretend to warrant ) the whole produce does not
, ,

much e xceed the value of the bounties which are annually paid
for it is in N ew England carried
,
without any bounty to a on

very great extent Fish is e o f the pri cipal articles with

. on n

which the N orth Americans trade to Spain P ortugal and t he , ,

M editerranean .

Sugar w s originally an enumerated commodity which could

a

be exported only to Great Britain But 73 u po n a ep e . in 1 1, r r

s c utation f the sugar planters its expo rtation was permitted

o -

to all parts f the world The restrictions however with which

o .
, ,

this liberty was granted j oined to the high price of sugar in

,

Great Britain have rendered it in a great measure ineffectual

, , , .

Great Britain and her colonies still continue to be almos t the

sole market for all the sugar produced in the British plantations .

Their consumption increases so fast that though in co sequence ,

n

o f the increasing improvement f Jamaica as well as f the o ,

o

Ceded Islands the importation o f sugar has increased very

,

greatly within these twenty years the exportation to foreig ,

n

countries is said to be not much greater than before .

Rum is a very important article in the trade which t he

Americans c arry on to the oast of Africa from which they c ,

bring back negro slaves in return .

If the whole surplus pro duce of America in gra in of all sorts ,

in salt provisions and in fish had been put into the enumera ,

tion and thereby forced into the market o f Great Britain it

, ,

would have interfered too much with the produce o f the industry
of ou ow
r npeople It was probably not so much from any
.

regard t o the interest of America as from a jealousy of thi s

interference that those important commodities have not only

been kept o u t o f the enumeration but that the importation into ,

Great Britain o f all grain ex ept ri c e and o f salt provisions

,
c , ,

has in the ordinary state of t h law been prohibited

,
e ,
.

The non enumerated c ommodities could originally be ex

-

ported to all parts of the world Lumber and rice having been .
,

once put into the enumeration when they were afterwards ,

taken out o f it were confined as to the European market t o

, , ,

the countries that lie south o f Cape Finisterre By the 6t h of .

George III c 5 all non enumerated commodities were sub

. . 2, -

j eec t d to the like restri c tion The parts O f Europe whi c h li

. e

south o f Cape Fi ist e are not manufacturing ountries and

n err c ,

we were less jealous f the olony ships carrying home from

o c

them any manufa tures which could interfere with our own
c .

The enumerated commodities are o f two sorts first such as : ,

 Co l o n i e s 77
are either the pe uliar produce o f Am erica or as c annot bec ,

produced or at least are not produced in the mother count ry

, , .

O f this k i d are m las ff e O o nuts tobac o p i

'

n rn e t
o ses , c o e ,
c c a -

,
c ,
n o,

ginger whale fin raw silk cotton wool beaver and other peltry
,
-
s, ,
-

, ,

o f Ameri c a indigo fustic and other dying woods ; se ondly

, , ,
c ,

such as are not the peculiar produce f America but which are o ,

a d may be produ ed in the mother country though not in

n c ,

such quantities as to supply the greater part o f her demand ,

which is pr i n ipally supplied from foreign ountries Of this

c c .

kind are all naval stores masts yards and bowsprits t a pit h , , , ,
r, c ,

and turpentine pig and bar iron opper o e hides and skins
, ,
c r , ,

pot and pearl ashes The largest importation o f commodities .

o f the first kind ould not discourage the growth o interfere

c r

with the s al e of any part of the produce o f the mother country .

By confinin g them t o the home market u mer hants it w s ,

o r c ,
a

expected would not only be enabled to buy them heaper in

,
c

the planta tions and consequently to sell them with a better

,

profit at home but to establish between the plantations and

,

foreign countries an advantageous arrying trade o f whi h c , c

Great Britain w as ne essarily to be the centre o emporium as c r ,

the European country in to which those commodities were first

to be imported The importation o f commodities o f the se ond
. c

kin d might be o managed too it was supposed as t interfere

s , ,
o ,

n o t with the sale f those of the same kind which were produ ed
o c

at home but with that of those whih were imported from

,
c

foreign c ountries ; be ause by means f proper duties they c ,

o ,

might be rendered always somewhat dearer than the former ,

and yet a g d deal heaper than the latter By confinin g such

oo c .

c ommodities to the home m arket therefore it was proposed to , ,

dis ourage the produce not f Great Britain but o f some foreign
c ,
o ,

c ountries with whi h the balan e o f trade was believed to be c c

unfavourable t Great Brita in o .

The prohibition of exporting from the olonies to any other c ,

c ountry but Great Britai m a ts yards and bowsprits tar n, s , , , ,

pit h and turpenti e naturally tended to lower the price o f

c ,
n ,

timber in the olonies and onsequently to i rease the expense

c ,
c nc

o f leari g their lands the prin ipal Obsta le to their improve

c n ,
c c

ment But about the beginni g of the present en t ury in

. n c ,

1 0
7 3 the,
pit h and t a c o m pany of Sweden endeavoured to
c r

raise the pri e f their o mmodities t Great Britain by pro

c o c o ,

hi bi t ig their exportation ex ept in their

n w ships at their ,
c o n ,

ow price and in su h quantities the y thought proper In

n ,
c as .

order to counteract this nota ble pie e of merc a tile poli y and c n c ,
7 8 T he W e al t h of N at i o n s
to render herse lf as mu c h as possible independent not only o f ,

Sweden but of all the other northern powers Great Britain

, ,

gave a bounty upon the importation of naval stores from

America and the eff e t o f this bounty was to raise the pri e f
,
c c o

t imber in Ameri a much more than the confinement to t he

c

home market c ould lower it ; and as both regulations were

enacted at the same time their joint effe t was rather to en ,
c v

courage than to dis ourage the clearing f land in America

c o .

Though pig and bar iron too have been put among the
enumerated commodities yet as when imported from America , , ,

they are exempted from considerable duties to which they are

subject when imported from any other country the one part of ,

the regulation contributes more to en ourage the ere tion of c c

furnaces in Ameri a than the other to discourage it There is

c .

no manufa ture which occasions so great a consumption f wood

c o

as a furnace or which can contribute so mu h to the clearing

,
c

of a country overgrown with it .

The tendency f some f these regulations to raise t he value

o o

o f timber in Am erica and thereby to facilitate the clearin g of

,

the land was neither perhaps intended nor understood by the

, , ,

legislature Though their beneficial e ffects however have been

.
, ,

in this respect ac idental they have not upon that account

c ,

been less real .

The most perfect freedom o f trade is permitted b etween t he

British colonies of Am eri c a and the West Indies both in t he ,

enumerated and in the non enumerated commodities Those -

colonies are now become so populous and thriving that each f o

them finds in some f the others a great and extensive market

o

for every part of its produ e All o f them taken together they c .
,

make a great internal market for the produ c e of one another .

The liberality o f England however towards the trade f her , ,

o

c olonies has been onfined chiefly to what on e ns the market

c c c r

for their produ e either in its rude state o in what may be

c , ,
r

called the very first stage f manufacture The more advanced o .

o more refined manufactures even o f the colony produ e the

r c ,

merchants and manufacturers f Great Britain choose to reserve o

to themselves and have prevailed upon the legislature to prevent

,

their esta blishment in the colonies sometimes by high duties , ,

and sometimes by absolute prohibitions .

While fo example Musk o d o sugars from the British planta

,
r ,
va

tions pay upon i mportation only 65 4 d the hundr edweight ; . .

white sugars pay £ d ; and refined either double o r

1 I S . 1 .
,

single in loaves £4 5 5 d When those high duties were

,
2 . 7
, 3
8
.
 Co l o n i es 79
imposed Great Brita in w as the sole and she st il l continues to
, ,

be the principal market to whi h the sugars o f the British c

colonies could be exporte d They amounted therefore to .

, ,
a

prohibition at first o f laying o refining sugar for any foreign

,
c r

market and at present o f claying o refining it for the market

,
r ,

whi h takes o ff perhaps more than nin e tenths o f the whole

c , ,
-

produce The manufacture f laying or refinin g sugar accord

. o c

i gly though it has flourished in all the sugar colonies f France

n ,
o ,

has been little cultivated in any o f those of England except fo r

the market o f the colonies the mselves While Grenada was i . n

the hands o f the French there w s a refinery o f sugar by clay a ,

ing at least upon almost every planta tion Sin ce it fell into
,
.

those of the English almost all works of this ki d have bee ,

n n

given up and there are at present October 773 I am assured

, ,
1 , ,

not above two o thr ee remaining in the island At present

r .
,

however by an indulgence of the custom house layed o

,
-

,
c r

refined sugar if reduced from loaves into powder is commonly

, ,

imported as Mu k o v a do s .

While Great Britain encourages in America the manufactures

o f pig and bar iron by exempting them from duties to whic h
,

the like commodities are subje c t when imported from any other
country she imposes an absolute prohibition upon the erection
,

o f steel furnaces and li ll in any f her Am erica n plantations

t mi s s o .

She will not suffer her colonists to work in those more refined
manufactures even for their own consumption ; but insists upon
their purchasing o f her merchants and manufacturers all goods
o f this kind which they have occasion f or .

She prohibits the exportation from e provinc e to another on

by water and even the carriage by land upon horseba k o in

,
c r

a art o f hats o f wools and woollen goods of the produ c e f

c , , ,
o

Ameri a ; a regulation which e ffectually prevents the establish

c

ment o f any manufacture of su h ommodities fo d ista nt sale c c r ,

and confines the industry o f her olonists in this way to su c h c

coarse and household manufactures as a private family o m c

mo ly makes fo its o w use o for that of some o f it s neigh

n r n r ~

bours m the same provin e c .

To prohibit a great people however fro m making all that , ,

they can o f every part of their own produce or from e mploying ,

their stock and industry in the way that they j udge most
advantageous to the mselves is a manifest violatio f the most ,
n o

sacred rights of mankind Unjust however as such pro .

, ,

hi bition may be they have not hitherto been very hurt ful t
s ,
o

the colonies Land is still so cheap and consequently labour

.
, , ,
80 The W eal t h of N at i o n s
so dear among them that they can import from the mother
,

country almost all the more refined o more advanced manu r

factures c heaper than they could make them for themselves .

Though they had not therefore been prohibited from establish

, ,

ing such manufactures yet in their present state f improve ,

o

ment a regard to their o w interest would probably have n , ,

prevented them from doing so In their present state of im .

provement those prohibitions perhaps without cramping their , ,

i ndustry or restraining it from any employment to which it

,

would have gone o f its own accord are only impertinent badges ,

o f slave ry imposed upon them without any su fli e t reason

ci ,
n ,

b y the groundless j ealousy of the merchants and manufacturers

o f the mother country In a more advanced state they might
.

be really oppressive and insupportable .

Great Britain too as she confines to her own market some

,

o f the most important productions o f the colonies so in c o m ,

p ensat i she gives

on to some o f them an advantage in that market ,

sometimes by imposing higher duties upon the like productions

when imported from other countries and so metimes by giving ,

b ounties upon their im portation from the colonies In the first .

w y she gives an advantage in the home market to the sugar

a ,

tobacco and iron of he r own colonies and in the second to their

, ,

raw silk to their hemp and flax t their indigo to their naval
, ,
o ,

stores and to their building timber This second w y o f eh

, . a

c u a i
o
g g
r thencol o ny produ e by bounties upon importation is c , ,

s o far as I have been able to learn peculiar to Great Britain ,

.

The first is not Portugal does o t content herself with im

. n

posing higher duties upon the importation o f tobacco from any

other country but prohibits it under the severest penalties
,
.

With regard to t he i mportation f goods from Europe England o ,

has likewise dealt more liberally with her colonies than any
other nation .

Great Britain allows a part almost always the half generally , ,

a larger portion and sometimes the whole o f the duty whi h is

,
c

paid upon the importation of foreign goods to be drawn back ,

upon their exportation to any foreign country N o independent .

foreign country it was easy to foresee would receive them if

, ,

they came to it loade d with the heavy duties to which almost all
f oreign goods are subj ected on their importation into Great
Britain Unless ther fore some part o f those duties wa drawn
.
,
e ,
s

back upon exp o rtation there was an end o f the car rying trade ;
,

a trade so much favoured by the mercantile system .

O ur colonies however are by no means independent foreign

, ,
 Co l o n i es 8I
c ountries ; and Great Britain having assumed to herself the
exclusive right o f supplying them with all goods from Europe ,

might have forced them (in the same manner as other countries
have done their colonies ) to receive such goods loaded with all ,

the same duties which they paid in the mother country But .
,

o n the contra ry till 763 the same drawbacks were paid upon
,
1 ,

the exportation o f the greater part of foreign goods to our

colonies as to any independent foreign country In 763 . 1 ,

indeed by the 4 t h o f George III c 5 this indulgence w a a

,
. . 1 ,
s

good deal abated and it was enacted That part o f the duty
, ,
no

called the o ld subsidy should be drawn back for any goods f o

the growth production o r manufacture o f Europe the East

, ,
or

Indies which should be exported from this kingdom t o any

,

British colony or plantation in America ; wines white c allic o e ,

s

and muslins excepted Before this law many different sort

.
”
,
s

o f foreign goods might have been bought cheaper in the planta

tions than in the mother country ; and some may still .

O f the greater part o f the regulations concerning the colony

trade the merchants who carry it on it must be observed hav e
, , ,

been the principal advisers We must not wonder therefore .

, ,

if in the greater part of them their interest has been more c o

, ,
n

si d e ed than either that o f the colonies o r that o f the mothe

r r

country In their exclusive privilege f supplying the colonie

. o s

with all the goods which they wanted from Europe and o f ,

purchasing all such parts o f their surplus produce as could o t n

interfere with any f the trades which they themselves carrie d

o

o n at home the interest o f the colonies w s sacrificed to the

,
a

i nterest of those merchants In allowing the same drawback . s

upon the e exportation f the greater part o f European a d

r -

o n

East India goods to the colonies as upon their re expo rtation t -

o

any independent country the interest o f the mother country ,

w a s sacrificed to it even according to the mercantile ideas o f

,

that interest It w a for the interest f the merchants to p ay

. s o

as little as possible for the foreign goods which they sent t the o

colonies and onsequently to get back as mu h as possible f

, ,
c ,
c o

the duties which they advanced upon their impo tation into r

Great Britain They might thereby be enabled to sell in t h

. e

colonies either the same quantity o f goods with a greate profit r ,

o r a greater quantity with the same profit and co n sequently , , ,

to gain something either in the o e w ay o the other It w a n r . s

likewise for the interest o f the colonies to get all such goods a s

cheap and in as great abundance as possible But this migh t .

not always be for the interest o f the mother country She might .
82 T he W e al t h o f N at i o n s
frequently su ffer both in her revenue by giving ba k a great ,
c

part of the duties which had been paid upon the importation o f
s uch goods ; and in her manufactures by being undersold in the ,

colony market in consequence of the easy terms upon whi h

, c

foreign manufactures could be carried thither by means f those o

d rawbacks The progress of the linen manufacture o f Great

.

Britain it is commonly said has been a good deal retarded by

, ,

the drawbacks upon the e exportation of German linen to t h e r -

A meric an colonies .

But though the policy o f Great Britain with regard to the

trade f her colonies has been dictated by the same mercantile
o

spirit as that o f other nations it has however upon the whole , , , ,

been less illiberal and Oppressive than that o f any f them o .

In everything except their foreign trade the liberty of the

, ,

English colonists to manage their w n aff airs their o w n w y is o a

c omplete It is in every respect equal to that of their fellow

.

c itizens at home and is secured in the same manner by an

, ,

assembly of the representatives f the people who claim the o ,

s ole right o f i mp i g taxes for the support o f the colony

‘

os n

government The authority o f this assembly overawes the

.

executive power and neither the meanest nor the most obnoxious
,

c olonist as long as he obeys the law has anything to fear from

, ,

the resentment either o f the governor or o f any other civil o r

,

military Oflic er in the province The colony assemblies though

‘
.
,

like the House o f Commons in England are not always a ,

v ery equal representation o f the people yet they approach ,

m ore nearly to that character ; and as the executive power

e ither has n t the means to corrupt them o
o on account of the ,
r,

support which it receives from the mother country is not un d er ,

th e necessity o f doing so they are perhaps in general more ,

i nfluenced by the inclinations o f their constituents The councils .

w hich in the colony legislatures correspond to the House o f

, ,

Lords in Great Britain are not composed of an hereditary ,

n obility In some o f the colonies as in three o f the govern

.
,

m ents of N ew England those councils are not appointed by ,

the king but chosen by the representatives o f the people In

,
‘

none of the English colonies is t here any hereditary nobility In .

all o f them indeed as in all other free countries the descendant

, , ,

o f an old colony family is more respected than an upstart o f

equal merit and fortune ;but he is only more respected and he has ,

no privileges by which he can be troublesome to his neighbours .

Before the commencement f the present disturbances the o ,

c olony assemblies had not only the legislative but a part of

 C o l o n i es 83
the executive power In Connecticut and Rhode Island they .
,

elected the governor In the othe r colonies they appointed the

.

revenue offi ers who collected the taxes imposed by those

c

respective assemblies to whom those flic e were im mediately ,

o
‘
rs

responsible There is more equality therefore among the

.
, ,

English colonists than among the inhabitants of the m other

country Their mann ers are more republican and their govern
.
,

ments those f three o f the prov inces f N ew England

, o o in

particular have hitherto been more republican too

, .

The absolute governments f Spain Port ugal and France o n o , , ,

the contrary take pla e in their c olonies ; and the discretiona y

, c r

powers which such governments ommonly delegate to all their c

i nf erior o fli e are c account o f the great distan e naturally

rs
,
on c ,

exercised there with more than ordinary violen e Under ll c . a

abs olute governments there is more liberty i the c apital th n n a

in any other part f the ountry The sovereign himself o c . c an

never have either interest o inclination to pervert the order o f r

justice o to oppress the g eat body o f the people In the

,
r r .

ca pital his presence overawes more or less all his inferior o fli e s c r ,

who i the remoter provin c es from when e the omplaints o f

n
,
c c

the people are less likely to reach him exer ise their tyran y ,
c an c n

with much more safety But the European colonies i Am erica . n

are more remote than the most distant prov nces o f the greatest
.

empires whi h had ever been know before The governm ent
c n .

o f the En lish olonies is perhaps the only one whi h sin e the
g c c ,
c

world began could give perfe t se urity to the i habi t ants o f

,
c c n

so very dista nt a provin e The administration of the Fren h c . c

c olonies however has always been ondu ted with more gentle
, ,
c c

ness and moderation than that of the Spanish and Portuguese .

This superiority o f condu t suitable both to the charac t er o f c Is

the French nation and to wha t form s the haracter o f every

,
c

nation the nature o f their government whih though arbitrary

, ,
c

and violent in omparison with that of Great Britain is legal

c ,

and free in omparison w ith those o f Spain nd Portugal

c a .

It in the progress o f the N orth Ameri c an c olonies however

Is
, ,

that the superiority o f the English policy hiefly appears Th e c .

progress f the sugar colonies o f France has been at least equal

o ,

perhaps superior to that o f the greater part of those of England

, ,

and yet the sugar colonies o f England enjoy a free government

nearly o f the same kin d with tha t which takes place in her
co lonies o f N orth America But the sugar olonies f France . c o

are not discouraged like those o f England from refining their

, ,

ow n sugar ; d what is o f stil l greater importance the genius

an , ,
 84 The W eal t h of N a t i o n s
of their govern ment naturally introduces a better management
o f their negro slaves .

In all European colonies the culture of the sugar cane is -

carried o by negro slaves The constitution of those who have

n .

been born in the temperate climate o f Europe could not it is ,

supposed support the labour of digging the ground under the

,

burning sun of the West Indies ; and the culture of the sugar
cane as it is managed at present is all hand labour though in
, , , ,

the Opinion of many the drill plough might be introduced into

,

it with great advantage But as the profit and success of the .

,

cultivation which is carried on by means of cattle depend very ,

much upon the good management o f those cattle so the profit ,

and success o f that which is carried o n by slaves must depend

equally upon the good management f those slaves ; and in the o

good management o f their slaves the French planters I think it ,

is generally allowed are superior to the English The law so

,
.
,

far as it gives some weak protection to the slave against the

violence o f his master is likely to be better executed in a co l ony
,

where the government is in a great measure arbitrary than in

o e where it is altogether free
n In every country where the .

unfortunate law f slavery is established the magistrate when

o , ,

he protects the slave intermeddles in some measure in the ,

management o f the private property of the master ; and in a ,

free country where the master is perhaps either a member of

,

the colony assembly or an elector of su h a member he dare

,
c ,

not do this but with the greatest caution and circumspection .

The respect which he is obliged to pay to the master renders it

more d iflic ult fo him to protect the slave But in a country
r .

where the government is in a great measure arbitrary where it ,

is usual fo the magistrate to intermeddle even in the manage

r

ment f the private property of individuals and to send them

o , ,

perhaps a l tt d ,
h t if they do no t manage it according to
e re e ca c e

his liking it is mu h easier for him to give some protection to

,
c

the slave ; and ommon humanity naturally disposes him to do

c

so The protection o f the magistrate renders the slave less

.

contemptible in the eyes of his master who is thereby induced ,

to consider him with more regard and to treat him with more ,

gentleness Gentle usage renders the slave not only more

.

faithful but more intelligent and therefore upon a double

, , ,

account more useful He approaches more to the condition of

,
.

a free servant and may possess some degree o f integrity and

,

attachment to his master s interest virtues which frequently ’

,

belong to free servants but which never can belong to a slave ,

 C o l o n i es 85
w ho is treated as slaves commonly are in countries where t he
master is perfectly free and secure .
«

That the condition o f a slave is better under an arbitrary

than under a free government is I believe supported by the , ,

history f all ages and nations In the Roman history the first
o .
,

time w read f the magistrate interposing to protect the slave

e o

from the violence o f his master is under the emperors Whe n .

V di
e u s Pollio in the presence o f Augustus ordered one o f his
, ,

slaves w h had c ommitted a slight fault to be cut into pieces

,
o ,

and thrown into his fish pond in order to feed his fishes the ,

emperor commanded him with indignation to emancipate, ,

immediately not only that slave but all the others that belonged
, ,

to him Under the republic no magistrate could have had

.

a uthority enough to protect the slave mu c h less to punish the ,

master .

The stock it is to be observed which has improved the sugar

, ,

colonies o f France parti cularly the great colony of St Domingo

,
.
,

ha s been raised almost entirely from the gradual improvement

and cultivation of those colonies It has been almost altogether .

the produce o f the soil and o f the industry of the c olonists ,

o r,

what comes to the same thing the price o f that produce gradually ,

accumulated by good management and employed in raising a ,

still greater produce But the stock which has improved and
.

cultivated the sugar colonies o f England has a great part o f it , ,

been sent o ut from England and has by no means been alto; ,

gether the produce o f the soil and indust y o f the colonists r

The prosperity o f the English sugar olonies has been in a great c ,

meas ure owing to the great riches o f England o f whi h a part

, ,
c

has o v erfl w ed if o e may say so upon those colonies But

o ,
n ,
.

the prosperity f the sugar colonies of Fran e has been entirely

o c

owing to the good conduct o f the colonists which must there ,

fore have had some superiority over that f the English ; and o

this superiority has been remarked in nothing so much as in

the good management o f their slaves .

Such have been the general outlines o f the polic y f the o

different European nations with regard t o their colonies .

The policy of Europe therefore has very l ittle t o boast o f

, , ,

either i the original establishm ent or so far as concerns

n
,

their internal government in the subsequent prosperity f the

, o

colonies o f Ameri a c .

Folly and injustice seem to have been the principles which

presided over and directed the first proje c t o f establishing those
colonies ; the folly o f huntin g after gold and silver mines and ,
86 T he W e al t h o f Nat i o n s
t he injustice o f coveting the possession o f a country whose
harmless natives far from having ever injured the people of
,

Europe had received the first adventurers with every mark of

,

k indness and hospita lity .

The adventurers indeed who formed some o f the later estab

, ,

li shme t n s, j oin ed to the c hirn e ic al project o f finding gold and r

silver min es other motives more reasonable and more laudable ;

but even these motives do very little honour to the policy of
Europe .

Th e English puritans restrained at home fled for freedom t o

, ,

America and established there the four governments o f New

,

England The English Catholics treated with much greater

.
,

i njustice estab l ished that o f M aryland ; the Quakers that o f

, ,

P ennsylvania The Portuguese Jews persecuted by the in

.
,

q u is i t i
o
n, stripped of their fortunes and banished to Brazil , ,

introduced by their example some sort o f order and industry

among the transported felons and strumpets by whom that
colony w s originally peopled and taught them the cul t ure o f
a ,

the sugar cane Upon all these different occasions it was n o t

-
.

the wisdom and policy but the disorder and injustice o f the,

Eu ropean governments which peopled and cultivated A merica .

In e ffectuating some of the most important of these estab

li shme t n s, the different governments o f Europe had as littl e
merit as i n projecting them The conquest o f Mexico was t he .

project not o f the ouncil of Spain but o f a governor f Cuba

,
c , o ,

and it w as effectuated by the spirit of the bold adventurer t o

whom it was entrusted in spite o f everything which that ,

governor who soon repented of having trusted such a person

, ,

c ould d o to thwart it The conquerors of Chili and Peru and

.
,

of almost all the other Spanish settlements upon the continent

o f Am erica carried o u t w i
,
t h t hem no other public encourage
ment but a general permission to make settlements and con
,

quests in the name f the king of Spain Those adventureso .

were all at the private risk and expense o f the adventurers .

The government o f Spain contributed scar e anything to any o f c

them That f England ontributed as little towards effec

. o c

t u a t igthe establishment of some o f its most important colonies

n

in N orth America .

When those establishments were e ff ectuated and had become ,

so considerable as to a t t c t t he attention of the mother country

ra
,

the first regulations which she made with regard to them had
always i view to secure to herself the monopoly o f their c m
n o

merce ; to confine the i r market and to enlarge her o wn at their ,

 C ol on i es 87
expense and consequently rather to damp and discourage
, , ,

than t o quicken and forward the c o urse of their prosperity In .

the different ways in which this monopoly has been exercised

‘

consists one o f the most essential differences in the policy of t he

difl e e t Europ ean nations with regard to their colonies
r n The .

best of them all that o f England is only somewhat less illiberal

, ,

and Oppressive than that f any of the rest o .

In what way therefore has the poli c y of Europe contribute d

, ,

either to the first establishment to the present grandeur o f ,

or

the colonies of America ? In o e way and in one way only n , ,

it has co ntributed a good deal M g vium M ter 1 It bred . a na r a

and formed the men who were capable of achieving such great
actions and of layin g the foundation f so great an empire ; a d
,
o n

there is no other quarter o f the world o f which the policy is

capable of formin g o r has ever actually and in fact formed such
,

men The colonies owe to the policy f Europe the educa tio
. o n

and great views of their active and enterpris ing founders ; and
some o f the greatest and most important f them so far as o ,

concerns their internal government o w e to it scarce anythin g ,

else .

PA RT T H I RD

Of the A dva n tages whi ch E u r o pe ha s d er i ved r o m the D i s co ver

y f
f
c a , a n d ro m tha t o f a P a s s a g
o f A mer i e t o the E as t I n dies b
y
the C a pe o f Go o d Ho pe .

S U C H are the advantages which the colonies f Am erica hav e o

derived from the policy of Europe .

What are those whi h Europe has derived from the discovery
c

and colonisation f America o

?

Those advantages may be divided first into the general , ,

advantages which Europe considered as great country ,

on e
,

has derived fro m those great events ; and se ondly into the ,
c ,

particular advantages whi h ea h olonising country has derive d

c c c

from the olonies which parti ularly belong t it in consequenc e

c c o ,

o f the au t hority dominion which it exercises over them

or .

The general advantages which Europe considered as e great , on

country has derived from the discovery and colo isation of

, n

America onsist first in the increase of its enjoyments and

,
c , , ,

secondly in the augmentation o f its industry

, .

The surplus produce of America imported into Europe , ,

furnishes the inhabitants o f this great ontinent with a variety c

o f commodities which they could n o t oth erwise have possessed ;

 88 T he W eal t h o f N at i o n s
some for conveniency and use some for pleasure and some for , ,

o rnament and thereby contributes to increase their enj oyments

, .

The discovery and colonisation o f America it will readily be ,

allowed have contributed to augment the industry first o f all

, , ,

t h e countries which trade to it directly such as Spain Portugal , , ,

France and England ; and secondly f all those whi c h with

, , ,
o
,

o u t trading to it directly send through the medium o f other

, ,

countries goods to it of their o w produce ; such as Austrian

,
n

Flanders and some provinces f Germany which through the

,
o , ,

m edium f the countries before mentioned send t o it a con

o ,

s id e a b le quantity o f linen and other goods

r All such c ountries .

have evidently gained a more extensive market fo r their surplus

produce and must consequently have been encouraged to
,

i ncrease t s quant ity

i

But that those great events should likewise have contributed

t o encourage the industry o f countries such as Hungary an d ,

P oland which may never perhaps have sent a single c o m

, , ,

m o di t y of their own produce to America is not perhaps , , ,

altogether so evident That those events have done so ho w

.
,

e ver cannot be doubted

,
Some part o f the produce f America
. o

is consumed in Hungary and Poland and there is some demand ,

t here for the sugar chocolate and tobacco of that new quarter
, ,

o f the world But those commodities must be purchased with

.

s omething which is either the produce o f the industry o f Hungary

a d Poland or with something which had been purchased with

n ,

some part o f that produce Those commodities of America are

.

ne w values new equivalents introduced into Hungary and

, ,

Poland to be exchanged there f the surplus produce of those or

countries By being carried thither they create a new and more

.

e xtensive market for that surplus produce They raise its value .
,

and thereby contribute to encourage its increase Though no .

p art of it may ever be carried to America it may be carried to ,

other countries which purchase it with a part o f their share o f

t h e surplus produce o f America ; and it may find a market by
means of the circulation of that trade which w s originally put a

into motion by the surplus produ e f America c o .

Those great events may even have contributed to increase

t he enjoyments and to augment the industry f countries which
,
o

not only never sent any commodities to America but never ,

received any from it Even such countries may have received

.

a greater abundance o f other commodities from countries o f

which the surplus produce had been augmented by means o f
the Am erican trade This greater abundance as it must n ec es
.
,
 C o l o n i es 89
s ar i
ly have increased their enjoyments so it must likewise have ,

augmented their industry A greater number o f new equivalents .

o f some kind o other must have been presented t o them to be

r

e xchanged for the surplus produce f that industry A more o .

e xte n s ve market must have been created fo

i that surplus r

produce 5 0 as to raise its value and thereby encourage its ,

increase The mass o f co mmodities annually thrown into the

.

g reat circle o f European commerce and by its various e o lu ,

r v

t ions annually distributed among all the different nations com

prehended within it must have been augmented by the whole
,

surplus pro duce o f America A greater share of this greater .

m ass therefore is likely to have fallen to each o f those nations

, , ,

t o have increased their enjoy m ents and augmented their ,

industry .

The exclusive trade o f the mother countries tends to diminish ,

o r,at least t keep down below what they would otherwise

,
o

r ise to both the enjoyments and industry o f all those nations

,

i n general and o f the American colonies in particular

,
It is a .

d ead weight upon the action o f o e o f the great springs which n

p uts into motion a great part o f the business o f manki n d By .

r endering the colony produce dearer in all other countries it ,

lessens its consumption and thereby cramps the industry f the

,
o

c olonies and both the enjoyments and the industry o f all other
,

c ountries which both enjoy less when they pay more for what
,

t hey e nj oy and produce less when they get less for what they
,

p roduce By .rendering the produce of all other countries dearer

i n the colonies it cramps in the same manner the industry
, ,
f all ,
o

o ther countries and both the enj oyments and the industry o f
,

t h e colonies It is a clog which f r the supposed benefit o f

.
,
o

s ome particular countries embarrasses the pleasures and e ,

n

c umbers the industry o f all other countries ; but o f the colonies

m ore than f any other It not only excludes as much as
o .
,

p ossible all other countries from

,
e particular market ; but it on

c onfines as much as possib le the colonies to o e particular

, , n

m arket ; and the di ff erence is very great between bei g excluded n

f rom n e particular market when all others are open and bei n g
o , ,

c onfined to o e particular market when all others are shut up

n , .

The surplus produce f the colonies however is the original

o , ,

source o f all that increase o f enj oyments and industry which

E urope derives from the discovery and colonisation o f America ;
an d the exclusive trade o f the mother countries tends to render
t his source much less abundant than it otherwise would be .

,The particular advantages which each colonisin g country

11 D
9 0 Th e W eal t h of N a t i o n s
derives from the colonies which particularly belong t o it a e r

o f two di ff erent kinds ; first those common advantages w hich

,

every empire derives from the provinces subj ect to its dominion ;
and secondly those peculiar advantages which are supposed
, ,

to result from provinces of so very peculiar a nature as the

European colonies o f America .

The common advantages which every empire derives from t he

provinces subj ect to its dominion consist first in the military , ,

force which they furnish for its defence ; and secondly in t h e , ,

revenue which they furnish for the support of its civil govern
ment The Roman colonies furnished occasionally both t he
.

o e and the other

n The Greek colonies sometimes furnished a
.
, ,

military force but seldom any revenue They seldom acknow

, .

ledged themselves subj ect to the dominion o f the mother city .

They were generally her allies in war but very seldom her ,

subj ects in peace .

The European co l on ies o f America have never yet furnished

any military force for the defence o f the mother country Thei . r

military force has never yet been su fficient for their o w defence ; n

and in the different wars in which the mother countries have

been engaged the defence o f their colonies has generally occa
,

sio d a very onsiderable distraction o f the military force o f

ne c

those countries In this respect therefore all the Europea

.
, ,
n

colonies have without exception been a cause rather o f we ak

, ,

ness than o f strength to their respective mother countries .

The colonies o f Spain and P ortugal only have contribute d

any revenue towards the defence o f the mother country o t he ,
r

support o f her civil government The taxes w hich have been

.

levied upon those o f other European nations upon those o f ,

England in particular have seldom been equal to the expens

,
e

laid o u t upon them in time o f peace and never sufficient t o ,

defray that whi h they occasioned in time o f war Such colonies

c .
,

t herefore have been a source o f expense and not o f revenu e

,

t o their respective mother countries .

The advantages o f such colonies to their respective mothe r

countries consist altogether in those peculiar advantages which
are supposed to result from provinces o f so very peculiar a
nature as the European colonies of America ; and the exclusive
trade it is a knowledged is the sole source o f all those peculia
,
c ,
r

a dvantages .

In c onsequence o f this exclusive trade all that part o f t he ,

s urplus produce o f the English colonies for example which , ,

consists in what are called enumerated commodities be ,

c an
 C o l o n i es 9 i

sent to no other country but Englan d O ther countries mus t .

afte wards buy it o f her It must be cheaper therefore in

r ;

England than it can be in any other country and must con ,

tribute more t o in c rease the enjoyments o f England than those

o f any other country It must likewise ontribute more t o
. c

encourage her i dustry F o all those parts o f her o w surplus

n . r n

produ e whi h England exchanges for those enumerated com

c c

mo d i ti she must get a better price than any other countrie s

es,

c an get fo the like parts f theirs when they ex hange them

r o ,
c

for the same commodities The manufactures o f England fo .

,
r

example Will purchase a greater quantity o f the sugar and

,

toba o o f her o w colonies than the like manufa tures o f

cc n c

other c ountries can purchase o f that sugar and tobac o So far c .

,

therefore as the manufactures o f England and those o f othe

,
r

countries are both to be exchanged fo the sugar and tobacco r

o f the English colonies this superiority f price gives an ’

,
o en

c o u rageme t to the former beyond what the latter ca

n in thes e n

circumstances enjoy The ex lusive trade of the colonies

. c ,

therefore as it diminishes
,
at least keeps down below what ,
or

they would otherwise rise to both the enjoyments and t he ,

industry o f the countries which do not possess it ; so it gives n a

evident advanta ge to the c ountries which do possess it over

those other countries .

This advanta ge however will perhaps be found t o be rathe

, ,
r

what may be called a relative than an absolute advantage ; a d n

to give a superiority t o the country which enjoys it rather b y

depressing the industry and produce o f other countries than b y
raising those o f that particular country above what they woul d
naturally rise to in the case o f a free trade .

The tobacco o f Maryland and Virginia fo r example by means , ,

o f the monopoly which England enjoys of it certa inly come s ,

cheaper t o England than it can d o to France t o whom Englan d ,

commonly sells a considerable part o f it But had France a d .

,
n

all other European countries been at all times allowed a fre e , ,

trade to Maryland and Vir gin ia the tobac o o f those olonie ,

c c s

might by this time have c ome c heaper than it actually does

, , ,

n o t only t o all those other countries but likewise to England , .

The produ c e f tobacco in c onsequence o f a market so mu h

o ,
c

more extensive th n any whi h it has hitherto enjoyed might

a c , ,

and probably would by this time have been so much in c reased

, ,

as to reduce the profits o f a tobacco plantation to their natural

level with those of a corn plantation which it is supposed they , , ,

are still somewhat above The price o f tobacco might a d .

,
n
9 2 Th e W e al t h of N at i o n s
pro bably would by this time have fallen somewhat lower than
, ,

it is at present An equal quantity o f the commodities either

.

o f England o o f those other countries might have purchased

r

in Maryland and Virginia a greater quantity o f tobacco than it

can d o at present and consequently have been sold there for
,

so much a better pri c e So far as that weed therefore can .

, , ,

by its cheapness and abundance in rease the enjoyments or ,

c

a ugment the industry either o f England o of any other country r ,

it would probably
,
the case f a free trade have produced
,
In o ,

both these e ffects in somewhat a greater degree than it can do

at present England indeed would not in this ase have had
.
, ,
c

a y advanta ge over other c ountries

n She might have bought .

the toba c o of her colonies somewhat cheaper and consequently

c ,

have sold some f her o w commodities somewhat dearer than

o n

she actually does But she could neither have bought the o e
. n

c heaper o sold the other dearer than any other country might
n r

have done She might perhaps have gained an absolute but

.
, , ,

S he would certain ly have lost a relative advantage .

In order however to obtain this relative advantage in the

, ,

c olony trade in order to exe ute the invidious and malignant

,
c

p roject f ex
o luding as muchc as possible other nations from
an y share in it England there are
,
very probable reasons for ,

believing has not only sacrificed a part o f the absolute advantage

,

w hich she as well as every other nation might have derived

, ,

from that trad e but has subjected herself both to an absolute

,

a d to a relative disadvantage in a lmost every other bran h of

n c

t rade .

When by the act o f navigation England assumed to herself

, ,

the monopoly o f the colony trade the foreign apitals which had ,
c

before been employed in it were ne essarily withdrawn from it c .

The English capital whi h had before c arried o but a part of ,

c n

it wa now to arry o the whole The apital which had

,
s c n . c

before supplied the olonies with but a part o f the goods which c

they wanted from Europe was now all that was employed to
supply them with the whole But it ould not supply them . c

with the whole and the goods with which it did supply them
,

were necessarily sold very dear The capital which had before .

bought but a part o f the su rplus produce of the colonies was ,

n o w all that was employed to buy the whole But it could not .

buy the whole at anything near the o ld price and therefore , , ,

whatever it did buy it ne c essarily bought very cheap But in .

an employment o f capital in which the mer hant sold very dear c

and bought very cheap the profit must have been very great , ,
 C o l o n i es 93
and much above the ordinary level o f profit in other branches
o f trade This sup e io it y o f profit in the colony trade ould
'

. r r c

not fail to draw from other branches of trade a part o f the capital
which had before been employed in them But this revulsion of .

capital as it must have gradually increased the ompetition o f

,
c

capitals in the colony trade 5 0 it must have gradually diminishe d

,

that competition in all those other branches f trade ; as it o

must have gradually lowered the profits of the e so it must on ,

have gradually raised those o f the other till the profits o f all ,

came to a ew level different from and somewhat higher than

n ,

that at which they had been before .

This double effect of drawing apital from all other trades c ,

and of raising the rate o f profit somewhat higher than it other

wise would have been in al l trades was not only produced by ,

this monopoly upon its first establishment but has continue d ,

to be produced by it ever since .

First this monopoly has been continually drawing capital

,

from all other trades to be employed that o f the colonies In .

Though the wealth o f Great Britain has incre ased ve ry much

since the establishment of the act o f navigation it certainly has ,

not in reased in the same proportion as that o f the colonies

c .

But the foreign trade o f every country naturally increases in

proportion to its wealth its surplus produce in proportion to its
,

whole produce ; and Great Britain having engrossed to hersel f

almost the whole o f wha t may be c alled the foreign trade o f t h e

colonies and her c apita l not having increase d in the same p ro

,

portion as the extent o f that trade she could not carry it o ,

n

without continually withdrawing from other branches of trad e

some part o f the ca pital which had before been employed in
them as well as withholding from them a great deal more which
would otherwise have gone to them Since the establishment o f .

the a t of navigation accordingly the colony trade has been

c , ,

continually increasing while many other b hc es of foreig n

,
ran

trade particularly o f that to other parts o f Europe have

, ,

been continually decaying O ur manufactures fo foreign sale

. r ,

instead o f being suited as before the act o f navigation to the

, ,

neighbouring market o f Europe or to the more dista nt o e o f ,

n

the countries which lie round the Mediterranean Sea have t he , ,

greater part of them been accommodated to the still mor

,
e

distant one o f the colonies t o the market in whi h they hav e

,
c

the m onopoly rather than to that in whih they have many c

competitors The c auses o f de ay in other branches of foreign

. c

trade which by Sir Matthew De ker and other writers have

, , c ,
94 T he W e al t h of N a t i o n s
b een sought for in the excess and improper mode of taxation in ,

the high price o f labour in the increase o f luxury etc may all , , .

be found in the over growth of the colony trade The mercantile

-

c apital f Great Britain though very great yet not bei n g infinite
o , , ,

a n d though greatly increased since the act of navigation yet not ,

being increased in the same proportion as the colony trade that ,

t rade could not possibly be carried o without withdrawing s o me n

p art of that capital from other branches of t a d e consequently r ,

no r

without some decay o f those other branches .

England it must be observed was a great tradin g country

, , ,

her mercantile capital was very great and likely to become still
g reater and greater every day not only before the act of naviga ,

tion had established the monopoly o f the colony trade but before ,

that trade was very considerable In the Dutch war during .

,

the govern ment of Cromwell her navy w s superior to that o f ,

a

Holland ; and in that which broke o u t in the beginning of the

r eign of Charles II it w s at least equal perhaps superior to the
.
,
a , ,

united navies o f France and Holland Its superiority perhaps .

, ,

w ould scarce appear greater in the present times ; at least if the

Dutch navy w a to bear the same proportion to the Dutch
s

c ommerce n o w which it did then But this great naval power .

c ould not in either o f those wars be owing to the act of

, ,

navigation During the first o f them the plan of that act had
.

been but just formed ; and though before the breaking out o f
the second it had been fully enacted by legal authority yet no ,

part of it could have had time to produce any considerable e ffect ,

a n d least o f all that part which established the exclusive trade

to the colonies Both the colonies and their trade were in c

. on

si d e a b le then in comparison o f what they are now

r The island .

o f Jamaica was an unwholesome desert little inhabited and less , ,

c ultivated N ew York and N ew Jersey were in the possession

.

o f the Dutch the half of St Christopher s in that of the French ’

: . .

The island o f Antigua the two Carolinas Pennsylvania Georgia

, , , ,

a n d N ova Scotia were not planted Virginia Maryland and .

, ,

N w England were planted ; and though t hey were very thriving

e

colonies yet there was not perhaps at that time either i

, , , ,
n

Europe or America a single person who foresaw o even ,

r

suspected the rapid progress which they have since made in

wealth population and improvement The island of Barbadoes
, ,
.
,

in short was the only British colony o f any consequence o f

,

which the condition at th at time bore any resemblance to what

it is at present The trade o f the colonies of which England
.
, ,

e ven for some time after the act o f navigation enj oyed but a ,
 Co l o n i e s 95
part (for the act o f navigation w a not very strictly executed s

till several years after it w enacted ) could not at that time

as ,

be the cause of the great trade o f E gland n o r o f the great n ,

naval power which was supported by that trade The trade .

which at that time supported that great naval power was the
trade o f Europe and of the countries which lie round the
,

Mediterranean Sea But the share which Great Brita in at

.

present enjoys f that trade could not support any su h great

o c

n aval power Had the gro wing trade o f the colo nies been left
.

free to all nations whatever share of it might have fallen to

,

Great Britain and a very considerable share would probably

,

have fallen to her must have been all an addition to this great
,

trade of which she was before in possession In consequence f . o

the monopoly the increase o f the colony trade has not so much
,

o cc a sioned an addition to the trade which Great Britain had

before as a total change in its dire tion c .

Secondly this monopoly has necessarily contributed to keep

,

up the rate o f profit in all the diff erent branches f British trade o

higher than it naturally would have been had all nations been
a llowed a free trade to the British colonies .

The monopoly of the colony trade as it necessarily drew ,

t owards that trade a greater proportion o f the capita l o f Great

Britain than what would have gone to it f its o w accord ; so o n

by the expulsion o f all foreign capitals it necessarily reduced

the whole quantity o f capital e mployed in that trade below
what it naturally would have been the case f a free trade in o .

B u t b lesseni ng the competition of capitals i that branch o f

,
y n

trade it necessarily raised the rate of profit that branch By

,
in .

lessening t o the competition f British capitals in all other

,
o ,
o

branches o f trade it necessarily raised the rate o f British profit

,

in all those other branches Whatever may have been at any .

,

particular period since the establishment of the act of naviga

,

t ion the s t ate

,
extent o f the mercantile capital f Great
or o

Britain the monopoly of the colony trade must during the

, ,

c ontinuance of that state have raised the ordinary rate o f

,

British profit higher than it otherwise would have been both

in that and in all the other branches of British trade If since .
,

the establishment o f the act f navigation the ordinary rate f o ,

o

British profit has fallen considerably as it certainly has it must , ,

h ave fallen still lower had not the monopoly established by

,

t hat act contributed to keep it up .

But whatever raises in any country the ordin ary rate o f profit
higher than it otherwise would be necessarily subjects that ,
9 6 Th e W eal t h of N a t i o n s
c ountry both to an absolute and to a relative disadvanta ge i n

every branch of t rade of which she has o t the monopoly n .

It subj ects her to an absolute disadvantage ; because in such

branches of trade her merchants cannot get this greater profi t
without selling dearer than they otherwise would do both t he
goods o f foreign countries which they import into their own ,

and the goods of their own country which they export to foreign
countries Their o wn country must both buy dearer and sell
.

dearer ; must both buy less and sell less ; must both enj oy les s
and produce less than she otherwise would do
,
.

It subj ects her to a relative disadvantage ; because in such

branches o f trade it sets other countries which are not subject
to the same absolute disadvantage either more above her o r

less below her than they otherwise would be It enables the m .

both to enj oy more and to produce more in proportion to what

she enj oys and produces It renders their superiority greater
.

or their inferiority less than it otherwise would be By raising .

the price of her produce above what it otherwise would be it ,

enables the merchants o f other countries to undersell her in

foreign markets and thereby to j ostle her out o f almost al l
,

those branches of trade of which she has n o t the monopoly

,
.

O ur merchants frequently complain o f the high wages o f

British labour as the cause of their manufactures being under
sold in foreign markets but they are silent about the high
,

profits of stock They complain of the extravagant gain o f

.

other people but they say nothing o f their own The high
,
.

profits o f British stock however may contribute toward s

, ,

raising the price of British manufactures in many cases as much ,

and in some perhaps more than the high wages o f Britis h

,

labour .

It is in this manner that the capital o f Great Britain o n may ,

e

j ustly say has partly been drawn and partly been driven fro m
,

the greater part of the diff erent branches o f trade of which she
has not the monopoly ; from the trade o f Europe in particular ,

and from that of the countries which lie round the Mediterranean
Sea .

It has partly been drawn from those branches of trade by

the attraction of superior profit in the colony trade in con
sequence of the continual increase o f that trade and o f t he ,

continual in suflic ie cy of the capital which had carried it o

n n

on e year to carry it on the next .

It has partly been driven from them by the advantage which

the high rate o f profit established in Great Britain gives t
, ,
o
 C o l o n i es 97
o ther countries in al l the d ifferent branches o f trade o f which
Great Britain has not the monopoly
As the monopoly of the colony trade has drawn from those
other branches a part o f the British capital which would other
wise have been employed in them so it has forced into them ,

many foreign capitals which would never have gone to them

had they not been expelled from the colony trade In those .

o ther branches f trade it has diminished the competition o f

o

British capital and thereby raised the rate o f British profit

,

higher than it othe wise would have b een O n the contrary

r .
,

it has increased the competition o f foreign ca pitals and thereby ,

sunk the rate o f foreign profit lower than it otherwise would

have been Both in the one way and in the other it must
.

evidently have subjected Great Britain to a relative d i s d t a v an

age ih all those other branches o f trade .

The colony trade however it may perhaps be said is, , ,

more advantageous to Great Brita in than any other ; and the

monopoly by forcing into that trade a greater proportion o f
,

the capital o f Great Britain than what would otherwise have

go n e to it has turned that capital into an e mployment more
,

a dvantag eous to the country than any other which it could

have found .

The most advantageous employm ent f any capital to the o

count y t o whic h t belongs that which m aintains there the

r i is

greatest quantity o f produ tive labour d increas es the most c ,

an

the annual produce f the land and labour o f that c oun t ry

o .

But the quantity o f produ tive labour which y capital em c an

ployed in the foreign trade o f onsumption can m aintain is c

exac tly in proportion it h been shown in the se ond book to

,
as c ,

the frequency f its returns A capital f a thousand pounds

o . o ,

for example employed in a foreign trade of consumption o f

, ,

which the returns are made regularly once i the year ca keep n ,
n

in constant employment in the ount ry to whi h it belongs a ,

c c ,

quantity f productive labour equal to what a thousand pounds

o

can main tain there fo a year If t he returns are made twi e

r . c

o thrice in the year it

r keep in onsta nt employment a
,
c an c

quantity o f p o duc t iy e labour equal to what two o three thou

r r

s nd pounds can maintain there for a year A foreign t rade o f

a .

consu mption rried o with a neighbouring ountry is upon this

ca n c ,

a count in general more advantageous than o e arried with

c n c on

a dis t a i
,

t roun t ry ; and fo the same reason a direct foreign

c r

trade o f consumption as it has likewise been shown in the ,

II D 2
9 8 Th e W eal t h of N at i o n s
second book is in general more advanta geous than a round
,

about o e n .

But the monopoly o f the colony trade so far as it has operated ,

upon the employment of the capital o f Great Britain has in all ,

c ases forced some part f it from a foreign trade of consumption o

c arried with a neighbouring to e carried o with a more

on ,
on n

distant ountry and in many cases from a direct foreign trade

c ,

o f onsumption to a round about one

c -

First the monopoly of the olony trade has in all cases for ed
,
c c

some part f the apital o f Great Britain from a foreign trade

o c

o f onsumption carried
c with a neighbouring to one carried on

on with a more distant country .

It has in all c ases forced some part o f that capital from the
, ,

trade with Europe and with the c ountries whi h lie round t he ,
c

M editerranean Sea to that with the more distant regions of ,

Am erica and the West Indies from which the returns are meces ,

sa irly less frequent t only on account o f the greater distance ,

no
,

but o account o f the peculiar cir umstances o f those countries

n c .

N ew olonies it has already been observed are always under

c , ,

stocked Their capital is always much less than what they

.

could employ with great profit and advantage in the improve

ment and cultivation of their land They have a constant .

demand therefore for more c apital than they have of their o w ;

, ,
n

and in order to supply the deficiency f their o w they en

,
o n,

d ea o u to borrow as mu h as they can f the mother ountry

v r c o c ,

to whom they are therefore always in debt The most comm on , ,

.

way in which the colonists ontra t this debt is not by borrow c c

ing upon bond o f the ri h people o f the mother country though c ,

they sometimes d o this t o o but by running as mu h in arrea '

,
c r

to their correspondents who supply them with goods from ,

Europe as those c orrespondents will allow them Their annual

,
.

returns frequently do not amount to more than a third and ,

sometimes o t to so great a proportion o f what they o we The

n .

whole capital therefore whi h their orrespondents advance t o

, ,
c c

them is seldom returned t o Britain in less than three and some ,

times o t in less than four o five years But a British capital

n r .

o f a thousand pounds fo example which is returned to Great ,

r ,

Britain only on e in five years keep in onstant employ

c ,
c an c

ment only one fift h part f the British industry which it could
-

maintain if the whole was returned once in the year ; and ,

instead o f the quantity f industry which a thousand pounds o

could maintain for a year can keep in onstant employment t he ,

c

quantity only which two hundred pounds can maintain fo a r

 C o l on i es 99
year The planter no doubt by the high price which he pays
.
, ,

for the goods from Europe by the interest upon the bills which ,

he grants at distant dat es and by the commission upon t he ,

renewal of those whi h he grants at near dates makes up and c , ,

probably more than makes up all the loss whi h his corre ,
c

sp o d e t can sustain by thi

n n s delay But though he may make .

up the loss f hi correspondent he cannot make up that o f

o s ,

Great Britain In a trade o f which the returns are very distant

.
,

the profit f the mer hant may be as great o greater than in

o c r

one in which they are very frequent and near ; but the a d t v an

age o f the country in which he resides the quanti t y o f p o ,

r

du c t i e labour constantly maintained there the annual produc e

v ,

of the land and labour must always be much less That the .

re t urns f the trade to Am erica and still more those o f that t o

o ,

the West Indies are in general t only more distant but more , ,
no

irregular and more un e rta in t o o than those o f the trade t o

,
c ,

any part o f Europe o even of the countries which lie round ,

r

the Mediterranean Sea will readily be allowed I im agine by , , ,

everybody who has any experience o f those different branche s

o f trade .

Secondly the monopoly of the colony trade has in many

, ,

cas es forced some part o f the capital o f Great Britain from a

,

direct foreign trade o f consu mption into a round about o -

ne .

Among the enumerated commodities which c a be sent to o n n

other market but Great Britain there are several of which t he ,

quantity ex c eeds very much the onsumption o f Great Britain c ,

and of whi h a part therefore must be exported to othe

c , , r

countries But this cannot be done without forcing some part

.

o f the capital o f Great Brita in into a round about foreign trad e -

of consumption Maryland and Virginia for example send .

, ,

an ually to Great Britai upwards o f nine t y six thousand hogs

n n -

heads of toba co and the consumption o f Great Brita in is said

c ,

no t t exceed fourteen thousand Upwards of eight y t w o thou

o .
-

sand hogsheads therefore must be exported to other ountries

, ,
c ,

to France to Holland and to the countries which lie round the

, ,

Baltic and Mediterranean Seas But that part of the capital .

o f Great Brita in whi h brings those eighty two thousand hogs c -

heads to Great Brita in whi h exports them from then e t ,

c re -

c o

those other c ountries and which brings back from those other ,

countries to Great Brita in either goods m oney in return i or ,

s

employed in a round about foreign trade of onsumption ; and -

is necessarily for ed into this employment i order to dispose o f

c n

this great surplus If we would compute in how many y ears .

 1 00 Th e W e al t h of N a t i o n s
t he whole o f th i s capital is likely to come back to Great Britain ,

w e must add to the dista n e o f the Am erican returns that o f c

t he returns from those other countries If in the direct foreign .

,

trade o f consumption which w e carry on with Am eri a the c ,

w hole capital employed frequently does not come back in less

t han three o four years the whole capital employed in this
r ,

r ound about o e is o t likely to come bac k in less than four or

-

n n

five If the o e a keep in constant employment but a third

. n c n

o r a fourth part o f the domestic industry which could be main

t a i d by a capital returned once in the year the other

ne n , ca

k eep in constant employment but a fourth o a fifth part o f that r

industry At some of the out ports a credit is commonl y given

.
-

to those foreign correspondents to whom they export their

t obacco At the port o f L ondon indeed it is commonly sold
.
, ,

for ready money The rule is W igh d p y At the port o f

.
,
e an a .

L ondon therefore the final returns o f the whole round about

, ,
-

t rade are more distant than the returns from America by the
t ime only which the goods may lie unsold in the warehouse ;
w here however they may sometimes lie long enough
, ,
But .

h a d not the olonies been confined to the market of Great

c

B ritain f the sale o f their tobacco very little more of it would

or ,

probably have ome to us than what was ne essary for the

c c

h ome consumption The goods which Great Britain purchases

.

a t present fo her o w onsumption with the great su plus o f

r n c r

t obacco which she exports t o other ountries she would in this c ,

c ase probably have purchased with the immediate produ e o f c

her o wn industry with some part o f her w manufactures

,
or o n .

That produce those manufactures instead f being almost

, ,
o en

t iely suited to o e great market as at present would probably

r n , ,

h ave been fitted to a great number o f smaller markets Instead .

of o negreat round about foreign trade of consu mption Great

-

Britain would probably have carried o a great number o f small n

d irect foreign trades o f the same kind O account o f the . n

frequency o f the returns a part and probably but a small part ; , ,

p erhaps not above a third or a fourth o f the apital which at c

present carries on this great round about trade might have been -

s u fficient to c arry on all those small direct ones m ight have ,

k ept in constant employment an equal quantity of British

industry and have equally supported the annual produce o f the
,

land and labour o f Great Britain All the purposes of this .

t rade being in this manner answered by a much s maller capital

, , ,

t here would have been a large S pare c apital to apply to other

p urposes to improve : the lands to increase the manufactures , ,

 Co l o n i e s 01

and to extend the commerce of Great Britain ; to come into

competition at least with t h other British capitals employed in e

all those different ways to reduce the rate of profit in them ,

all and thereby to g ive to Great Britai in all of them a

,
n, ,

superiority over other countries still greater than what she at

present enjoys .

The monopoly o f the colony trade too has for ed some part , ,
c

of the capital f Great Britain from all foreign trade f c

o o on

sumption to a carrying trade and consequently from support ,

ing more or less the in dustry f Great Britain to be employe d o ,

altogether in supporti g p rtly that o f the olonies and partly n a c

that f some other ountries

o c .

The goods fo example whi h are an nually purchas ed with

,
r ,
c

the great surplus of eighty two thousand hogsheads f tobacco -

o

an nually e exported from Great Britain are not all onsume d

r -
c

in Great Britain Part o f them linen from Germany and

.
,

Holland for example is retu ned to the colonies for their par
, ,
r

tic u la consu mption But that part f the c apital of Great

r . o

Brita in which buys the tobacco with which this linen is after
wards bought is necessarily withdraw from supporting the n

industry o f Great Britain to be employed altogether in up ,

s

porting partly that o f the colonies and partly that of t he

, ,

parti ular countries who pay fo this toba o with the produce
c r cc

o f their own in dustry .

The monopoly of the olony trade besides by forcing toward s c ,

it a much greater proportion of the capital o f Great Britain

'

than what would naturally have gone to it seems to have ,

broken altogether that natural balance which would other w is e

have taken place among all the different branches of British

industr y The industry o f Great Britain instead of being
.
,

accommodated to a great number of small markets has been ,

principally suited to one great market Her ommer e instead . c c ,

of runn ing in a great nu mber o f small cha nels has been taught n ,

t o run prin ipally i one great hann el

c But the whole system
n c .

o f her industry and c o mm erce has thereby been rendered les s

secure the whole state of her body politic less healthf ul than
,

it otherwise would have been In her present ondition Great . c ,

Brita in rese mbles ne of those unwholesome bodies in which

o

some of the vital parts are overgrow and whi h upon that n, c ,

account are liable to many dangerous disorders s arce in ident

, c c

to those in whi h all the parts are more properly proportioned

c .

A s mall stop in that great blood vessel which has been arti -

ally swelled beyond i t s fi t u l dimensions and through

'
'
fic i na ra ,
1 02 The W e al t h of N a t i o n s
w hich an unnatural proportion of the industry and commerce
o f the country has been forced to cir ulate is very likely to c ,

bring o n the most dangerous disorders upon the whole body

politic The expectation of a rupture with the colonies accord
.
,

in ly has struck the people o f Great Britain with more terror

g ,

than they ever felt for a Spanish armada or a French invasion ,

.

It was this terror whether well o ill grounded which rendered

,
r ,

the repeal of the stamp act among the mer hants at least a ,
c ,

popular measure In the total ex lusion from the colony

. c

m arket was it to last only for a few years the greater part of
, ,

o u r mer hants used to fan y that they foresaw an entire stop

c c

to their trade ; the greater part of our master manufacturers ,

the entir e ruin of their business ; and the greater part of o ur

workmen an end o f their employment A rupture with any o f
,
.

o u neighbours upon the continent though likely too to o casion

r , , ,
c

s ome stop o interruption in the employments of some of all

r

these different orders of people is foreseen however without , , ,

any su h general emotion The blood of which the circulation

c .
,

is stopped in some o f the smaller vessels easily disgorges itself ,

into the greater without oc asioning any dangerous disorder ; c

but when it is stopped in any of the greater vessels c o v ul

, ,
n

s ions apoplexy
,
death are the immediate and unavoidable
,
or ,

c onsequences If but e o f those overgrown manufactures

. on ,

which by means either of bounties o of the monopoly of the

,
r

home and colony markets have been artificially raised up to an ,

unnatural height finds some small stop or interruption in its

,

e mployment it frequently o casions a mutiny and disorder

,
c

a larming to government and e mbarrassing even to the delibera

,

tions f the legislature Ho w great therefore would be the

o .
, ,

d isorder and confusion it was thought whic h must necessarily

, ,

be occasioned by a sudden and entire stop in the employment

o f so great a proportion o f our principal manufacturers ?

Some moderate and gradual relaxation o f the laws which give

to Great Britain the exclusive trade to the colonies till it is ,

r endered in a great measure free seems to be the only expedient ,

which can in all future times deliver her from this dan ger
, , ,

which can enable her o even forc e her to withdraw some partr

o f her capital fro m this overgrown emplo yment and to t urn it , ,

though with less profit towards other employments ; and which

, ,

by gradually diminishing o e branch o f her industry and gradu n

ally increasing all the rest by degrees restore all the different
,
c an

branches o f it to that natural healthful and proper proportion , ,

which perfect liberty necessarily establishes and which perfect ,

 C o lo n ies I o 3
liberty can alone preserve To open the colony trade all at .

o nce to all nations might t only occasion some transitory no

inconveniency but a great pe manent loss to the greater part

,
r

o f those whose indust ry o capital is at present engaged in it r .

The sudden loss of the employment even o f the ships which

import the eighty two thousand hogsheads o f tobacco which
-

are over and above the consumption of Great Brita in might ,

a lone be felt very sensibly Such are the unfort unate effects of.

all the regulations o f the mercantile system " They not only
introduce very dangerous disorders into the state of the body
politic but disorders which it is often di fficult to remedy with
, ,

o u t occasioning fo a time at least still greater disorders In

,
r ,
.

what manner therefore the colony trade ought gradually t o be

, ,

opened ; what are the restraints which ought first and what ,

are those which ought last to be taken away ; or in what manner

the natural system of perfect liberty and justice ought gradually
to be restored w e must leave to the wisdom of future statesmen
,

a n d legislators to determine .

Five different events unforeseen and unthought of have , ,

ve ry fortunately concurred to hinder Great Bri t ain from feeling ,

so sensibly as it was generally expected she would the total ,

e xclusion which has now taken place for more than a year from
(
the first of December 774 ) from a very important bran h of ,
1 c

the colony trade that o f the twelve associated provinces of

,

N orth America First those colonies in preparing themselves

.
, ,

fo their non importation agreement drai ed Great Britain

r -

,
n

completely of all the commodities which were fit for their

market ; secondly the extraordinary demand f the Spanish
,
o

Flota has this year drained Germany and the N orth of many
, ,

commodities linen in particular which used to come into com

, ,

petition even in the British market with the manufa tures f

, ,
c o

Great Britain ; thirdly the peace between Russia and Turkey ,

has occasioned an extraordinary demand from the Turkey

market which during the distress o f the country and while
, , ,

a Russian fleet was cruising in the Archipelago had been very ,

po orly supplied ; fourthly the demand of the N orth o f Europe ,

fo the manufactures o f Great Britain has been increasing fro m

r

year to year for some time past ; and fift hly the late partition ,

a d onsequential
n c ac fi
i c a t i
o n of Poland by opening the market
p ,

o f that g reat country have this year added an extraordinary

,

d emand from thence to the incre asing demand o f the N orth .

These events are all except the fourth in their nature transitory
, ,

and accidental and the exclusion fro m so important a branch

.
1 04 . Th e W eal t h of N at i o n s
of the colony trade if unfortunately it should continue much
,

longer may still occas ion some degree of distress This distress
,
.
,

however as it will come

,
gradually will be felt mu h less
on ,
c

severely than if it had com e o n all at once ; and in the mean ,

time the industry and capital o f the country may find a ew

,
n

employment and direction so as to prevent this distress from

,

ever r s ing to any considerable height

i .

The monopoly of the olony trade therefore so far as it has

c , ,

turned towards that trade a greater proportion of the capital o f

Great Br i tain than what would otherwise have gone t o it has ,

in all cases turned it from a foreign trade of consumption with

,

a neighbouring into one with a more distant country ; in many

cases from a direct foreign trade o f consumption into a round
,

about o e ; and in some cases from all foreign trade o f con

n ,

sumption into a carrying trade It has in all cases therefore .

, ,

turned it from a direction in which it would have maintained

a greater quantity of productive labour into o n e in which it
can maintain a much smaller quantity By suiting besides t o .
, ,

o e particular market only so great a part o f the industry and

n

commerce o f Great Britain it has rendered the whole state o f

,

that industry and commerce more precarious and less secure

than if their produce had been accommodated to a greater
variety o f markets .

We must carefully distinguish between the e ffects o f the

colony trade and those of the monopoly of that trade The .

fo rmer are always and necessarily beneficial ; the latter always

and necessarily hurtful But the former are so beneficial that
.

the colony trade though subject to a monopoly and o t wit h

, ,
n

standing the hurtful e ffects o f that monopoly is still upon t he ,

whole beneficial and greatly beneficial ; though a good deal les s

,

so than it otherwise would be .

The e ffect o f the colony trade in its natural and free state is
to Open a great though distant market for such parts o f t he
, ,

produ e o f British industry as may exceed the demand of the

c

markets nearer home of those f Europe and o f the countrie s

,
o ,

which lie round the Mediterranean Sea In its natural and free .

state the colony trade without drawing from those markets

, ,

any part o f the produce which had ever been sent t o them ,

encourages Great Britain to increase the surplus continually by

continually presenting new equivalents to be exchanged fo it r .

In its natural and free state the colony trade tends to increase
,

the quantity o f productive labour in Great Britain but without ,

altering in any respect the direction o f that which had bee n

 C o l o n i es I 05

employed there before In the natural an d free state o f t he.

colony trade the competition o f alF o t her nations would hinde r

,

the rate o f profit from risin g above the ommon level either in c

the new market or in the new employment The new market .

,

without drawi g anything from the old o e would create if o e

n n , ,
n

may say so a new produce for its own supply ; and that w
,
ne

produ e would constitute a new api t al fo carryin g on the w

c c r ne

employment which in the same manner would draw nothing

,

fro m the o ld one .

The monopoly o f the colony trade o the ontrary by ex c lu d ,

n c ,

ing the ompetition o f other nations and thereby raising t he

c ,

rate of profit both in the new market and in the new employ
ment draws produce from the old market and capital from t he
,

o ld employm ent To augment u share of the colony trad e

. o r

beyond what it otherwise would be is the avowed purpose o f

the monopoly If o ur share o f that trade were to be no greater
.

with than it would have been without the monopoly there ,

could have been no reason for establishi g the monopoly B ut n .

whatever for es into a branch o f trade o f whi h the return s

c c

are slower and more distant than those of the greater part o f
other trades a greater proportion of the apital o f any country
,
c

t han what o f its o wn accord would go to that branch necessarily ,

renders the whole quantity o f produ c tive labour annually main

t ain ed there the whole annual produce o f the land and labou r
,

of that country less than they otherwise would be It keeps

,
.

down the revenue of the inhabitants o f that ountry belo w c

what it would naturally rise to and thereby diminishes their ,

power of a umulation It o t only hinders at all times their

cc . n , ,

capital from maintaining so great a quantity of productive

labour as it would otherwise main tain but it hinders it from ,

i creasing so fast as it would otherwise i cre e and c e

n n as ,
ons

quently from maintainin g a still greater quantity f produ tive o c

labour .

The natural good effects o f the colony trade however more , ,

than counterbalance to Great Britain the bad effe ts of t he c

monopoly so that monopoly and all together that trade eve

, , , ,
n
as it is carried on at present is o t only advantageous b u t ,
n
,

greatly advantageous The new market and the new employ.

ment which are opened by the olony trade are of mu h greate c c r

extent than that portion f the o ld marke t and o f the o ld o

employment which is lost by the monopoly The new produce .

and the new c pital which has been created if o e m y say so

a
,
n a
,
by the colony trade maintain in Great Britain a greater quantity
,
1 06 The W e al t h of N at i o n s
o fproductive labour than what ca n have been thrown out o f
e mployment by the revulsion o f capital from other trades o f -

which the returns are more frequent If the colony trade how .
,

e ver even as it is carried o n at present is advantageous to Great

, ,

B ritain it is not by means of the monopoly but in spite of the

, ,

m onopoly .

It is rather fo the manufactured than for the rude produce

r

o f Europe that the colony trade Opens a new market Agri .

c ulture is the proper business o f all new colonies ; a business

whi h the cheapness o f land renders more advantageous than

c

an y other They abound

. therefore in the rude produce of
,
land , ,

an d in stead o f importing it from other countries they have ,

g enerally a large surplus to export In new colonies agriculture .

,

e ither draws hands from all other employments or keeps them ,

f rom going to any other employment There are few hands to .

spare for the necessary and none for the ornamental manu ,

fa c tures The greater part f the manufactures o f both kinds

. o

they find it cheaper to purchase of other countries than to make

fo i é t hems lv es
r It is chiefly by en ouraging the manufactures
e . c

o f Europe that the colony trade indirectly encourages its agr i

c ulture The manufactures o f Europe to whom that trade gives

.
,

e mployment constitute a new market for the produce of the

,

land ; and the most advantageous of all markets the home ,

m arket fo r the corn and cattle for the bread and but c her s
’
,

m eat of Europe is thus greatly extended by means of the trade

,

t o Am erica .

But that the monopoly of the trade o f popu l ous and thriving
colonies is not alone su fficient to establish o r even to mainta in ,

m anufactures in any country the examples o f Spain an d ,

Portugal suflic ie t ly demonstrate Spain and Portugal were

n .

m anufacturing ountries before they had any considerable

c

c olonies Sin e they had the richest and most fertile in the
. c

world they have both ceased to be so

,
.

In Spain and Portugal the bad e ffects o f the monopoly ,

a ggravated by other auses have perhaps nearly overbalanced

c ,

the natural good e ffects of the c olony trade These causes .

s eem to be other monopolies of di fferent kinds ; the degradation

o f the value of gold and silver below what it is in most other

c ountries ; the exclusion from foreign markets by improper

taxes upon exportation and the narrowing o f the home market
, ,

by still more improper taxes upon the transportation of goods

from o e part o f the country to another ; but above all that
n ,

irregular and partial administration of justice which often ,

 C olon ies I 07

protects the ri h and powerful debtor from the pursuit o f his

c

injured creditor and which make s the industrious part of the

,

n ation afraid to prepare goods for the consumption o f those

h aughty and great men to whom they dare not refuse to sell
upon credit and from whom they are altogether uncertain o f
,

repayment .

In England o the contrary the natural good e ffects o f the

,
n ,

colony trade assisted by other causes have in a great measure

, ,

conquered the bad effe ts of the monopoly These causes seem

c .

to be the general liberty of trade which notwithstand ing so

: , ,

restraints is at least equal perhaps superior to what it is in

, , ,

any other country ; the liberty of exporting duty free almost , ,

a ll sorts of goods whi ch are the produ e of domestic industry to c

almost any foreign country ; and what perhaps is of still greater

importance the unbounded liberty o f transporting them from
,

any one part of o u o wn country to any other without bein g

r

obliged to give any ac ount to any publi offi e without being

c c c ,

liable to question o examination f any kind ; but above all

r o ,

that equal and irn p a t il administration f justice which renders

r a o

the rights f the meanest British subj ect respectable to the

o

greatest and which by securing to every man the fruits of his

, ,

ow n industry gives the greatest and most effectual encourage

,

ment to every sort o f industry ,

If the manufactures o f Great Britain however have been , ,

advanced as they c erta inly have by the colony trade it has

, , ,

not been by means o f the monopoly of that trade but in spite

o f the monopoly The effect of the monopoly has been o t to
.
,
n

augment the quantity but to alter the quality and shape of a

,

part o f the manufactures o f Great Britain and to accommodate ,

to a market from which the returns are slow and distant

,
‘

what would otherwise have been a commodated to one from c

whi h the returns are frequent and near Its efl ec t has con
c .

sequently been to turn a part of the capita l o f Great Brita in

from an employment in which it would have main tained a greater
quantity of manufacturing industry to one in whi h it main c

ta ins a much smaller and thereby to diminish instead of , ,

increas ing the whole quantity of manufacturing industry main

,

t ain ed in Great Britain .

The monopoly o f the colony trade therefore like all the other , ,

mean and m alignant expedients of the mercantile system ,

depresses the industry o f all other countries but chiefly that of ,

the colonies without in the le ast in creasing but on the contrary

, ,

diminishin g that o f the country in whose favour it is established .

 1 08 The
W eal t h of N a t i o n s
The monopoly hinders the capital of that country whatever ,

may at any particular time be the extent of that capital from ,

maintaining so great a quantity of productive labour as it would

otherwise m aintain and from affording so great a revenue t o
,

the industrious inhabitants as it would otherwise afford B ut .

as capital can be increas ed only by savings from revenue the ,

monopoly by hindering it from affording so great a revenue a s

,

it would otherwise afford necessarily hinders it from in reasing

,
c

so fast as it would otherwise increase and consequently from ,

maintaining a still greater quanti t y o f productive labour and ,

affording a still greater revenue to the industrious inhabitants

o f that country O ne great original source of revenue there
.
,

fore the wages o f labour the monopoly must ne essarily have

, ,
c

rendered at all times less abundant than it otherwise would

have been .

By raising the rate of mercantile profit the monopoly dis ,

courages the improvement of land The profit of improvement .

depends upon the difference between what the land actually

produces and what by the application of a certain capital it
, , ,

can be made to produce If this difference aff ords a greater

.

profit than what can be drawn from an equal capital in any

m ercantile employment the improvement o f land will draw
,

capital from all mercantile employments If the profit is less .

,

mercantile employments will draw capital from the improve

ment f land Whatever therefore raises the rate of mercantile
o .
, ,

profit either lessens the superiority o increases the inf eriority

,
r

of the profit o f improvement ; and in the o n e case hinders capita l

from going to improvement and in the other draws capital from ,

it But by discouraging improvement the monopo l y ec es

.
,
n

sar ily retards the natural increase of another great original

sourc e of revenue the rent of land By raising the rate of profit
,
.
,

too the monopoly necessarily keeps up the market rate of

,

interest higher than it otherwise would be But the pri e of . c

land in proportion to the rent which it affords the number o f ,

years purchase which is commonly paid for it necessarily falls ,

as the rate of interest rises and rises as the rate of interes t ,

falls The monopoly therefore hurts the interest of the land

.
, ,

lord two different ways by retarding the natural increase first

, , ,

of his rent and secondly o f the price which he would get for
, ,

his land in proportion to the rent which it affords .

The monopoly indeed raises the rate o f mercantile profit ,

and thereby augments somewhat the gain o f our merchants .

But as it obstructs the atural increase of capital it tends n ,

 C o l o n i es 10
9
rather to diminish than t o in crease the sum total o f the revenue
which the inhabitants o f the country derive from the profits of
stock ; a small profit upon a great capital generally affordi g a n

greater revenue than a great profit upon a small one The .

monopoly raises the rate of profit but it hinders the sum o f ,

profit from rising so high as it otherwise would do .

All the origin al sources o f revenue the wages o f labour the , ,

rent o f land and the profits of stock the monopoly renders

, ,

much less abundant than they othe wise would be To promote r .

the little interest of o e little order of me in one country it

n n ,

hurts t he interest o f all other orders o f men in that coun t ry ,

a n d of all men in all other countries .

It is solely by raising the ordin ary rate o f profit that the

monopoly either has proved or could prove advantageous to any
o e particular order o f men
n But besides all the bad effects to
.

the c ountry in general which have already been mentioned as

,

n ecessarily resulting from a high rate o f profit there is o e ,

n

more fatal perhaps than all these put together but which if
, , , ,

w e may judge from experience is inseparably con ected with ,

n

it The high rate of profit seems everywhere to destroy that

.

parsimony which in other circumstances is natural to the char

acter o f the merchant When profits are high that sober virtue
.

s eems to be superfluous and expensive luxury to suit better the

a flflu e c e o f his situation

n But the owners of the great mer
.

c ti
an l capita ls are necessarily the leaders and conductors o f the
e

whole industry f every nation and their example has a mu h

o ,
c

greater influence upon the manners of the whole industrious

part f it than that of any other order o f men If his employer
o .

is attentive and parsimonious the workman is very likely to be ,

so t o o ; but if the master is dissolute and disorderly the servant ,

w h shapes his w ork a ording to the pattern w hi

o ch his master
cc

pres ribes to him will shape his life too accordi g to the example
c n

whi c h he sets him Ac umulation is thus prevented in the

. c

hands o f all those who are naturally the most disposed to

a c u mulate and the funds destined for the maintenance o f
c ,

produ c tive labour receive no augmentation from the revenue of

those w h ought naturally t augment them the most The
o o .

c apital of the ountry instead o f i creasing gradually dwindles

c ,
n ,

away and the quantity of productive labour m ain ta ined in it

,

grows every day less and less Have the exorbitant profits o f .

the merchants of Cadiz and Lisbon augmented the apita l o f c

Spain and Portugal ? Have they alleviated the poverty have ,

they promoted the industry f those t w o beggarly countries ? o

1 10 T he W eal t h of N at i o n s
Such has been the tone of mercantile expense in those two
trading cities that those exorbitant profits far from augment ,

ing the general capital of the country seem scarce to have been ,

su ffi ient to keep up the capitals upon which they were m ade

c .

Foreign c apitals are every day intruding themselves if I may ,

say so more and m ore into the trade of Cadiz and Lisbon It
, .

is to expel those foreign apitals from a trade which their own

c

grows every day m ore and more insu ffi ient for c arrying on c

that the Spaniards and Portuguese endeavour every day t o

straighten more and more the galling bands o f their absurd
monopoly Compare the mercantile manners o f Cadiz and
.

Lisbon with those o f A msterdam and you will be sensible ho w ,

differently the conduct and character of merchants are affected

by the high and by the low profits of sto c k The merchants f . o

London indeed have not yet generally become su h m agni

, ,
c

fi e t lords as those of Cadiz and Lisbon but neither are they

c n ,

in general such attentive and parsimonious burghers as those o f

Am sterdam They are supposed however many of them to
.
, , ,

be a good deal richer than the greater part f the former and o ,

not quite so ri h as many o f the latter But the rate of their

c .

profit is commonly much lower than that o f the former and a ,

good deal higher than that f the latter Light come light goo .
, ,

says the proverb ; and the ordinary tone o f expense seems every
where t o be regulated not so much according to the real ability
,

o f spending as to the supposed fa ility o f getting money t o

,
c

spend .

It is thus that the single advantage whi c h the monopoly

pro ures to a single order o f men is in many different ways
c

hurtful to the general interest f the ountry o c .

To found a great empire for the sole purpose o f raising up a

people of ustomers may at first sight appear a proje t fit only
c c

for a nation of shopkeepers It is however a proje c t altogether

.
, ,

unfit f a nation of shopkeepers ; but extremely fit for a nation

or

whose government is influen ed by shopkeepers Such states c .

men and such statesmen only are capable o f fan ying that they
, ,
c

will find some advantage in employin g the blood and treasure

o f their fellow itizens to found and maintain su h an e mpire
-

c c .

Say to a shopkeeper Buy me a good estate and I shall always

, ,

buy my lothes at your hOp even though I should pay some

c s ,

what dearer than what I can have them for at other shops ; and
y o u will o t find nhim very forward to embrace your proposal .

But should any other person buy yo u such an estate the shop ,

keeper would be mu h obliged to your benefactor if he would

c
 C ol o n ies I 1 1

enjoin you t o buy all your clothes at his shop England pur .

chased for some o f her subjects who found themselves uneas y ,

at home a great esta te in a distant country The price indeed

,
.
, ,

w as ver small and instead o f thirty years pur hase the ordi
’
c
y
nary price o f land in the present times it amounted to littl e
, ,

more than the expense o f the different equipments which made

the first discovery reconnoi t red the oast and took a fictitiou s
,
c ,

possession o f the country The land was good and o f great .

extent and the cultivators having plenty o f good ground t o

,

work upon and being for some time at liberty to sell their
,

produ c e where they pleased became the course o f little more ,

in

than thirty or forty years (between 6 0 and 660) so numerous 1 2 1

and thr ivi g a people that the shopkeepers and other traders
n

of England wished t o secure to themselves the monopoly o f

their custom Without pretendi g therefore that they had
. n , ,

paid any part either o f the origin al purchase money o o f t he

,
-

,
r

subsequent expense o f improvement they petitioned the parlia ,

ment that the cultivators o f America might for the fu t ure b e

confined to their shop ; first for buyin g all the goods whi h ,
c

they wanted from Europe ; and secondly for selling all such , ,

parts o f their o w produce as those traders might find it n

n co

v en ie t to buy
n F o r they did not find it convenient to buy
.

eve y part of it Some parts of it imported into England might

r .

have interfered with some o f the trades which they themselve s

carried on at home Those particular parts o f it therefore
.
, ,

they were will ing that the colonists should sell where they
could— the farther o ff the better ; and upon that a count pur c

posed that their market should be confined to the ountries c

south o f Ca pe Finisterre A lause in the famous act o f naviga . c

tion established this truly shopkeeper proposal into a law .

The maintenan e o f this monopoly has hitherto been t he

c

principal o more properly perhaps the sole end and purp ose o f
,
r

the domi ion whi h Great Brita in assumes over her colonies
n c ,

In the exclusive trade it is supposed onsists the great d a

, ,
c a v n

tage of provin es whi h have never yet afforded either revenu e

c ,
c

or military force for the support f the civil government o t h o ,

r e

defence o f the mother ountry The monopoly is the principal c .

badge f their dependency and it is the sole fruit which has

o ,

hitherto been gathered from that dependency Whatever ex .

pense Great Britain has hitherto laid out in main taining t his
dependency has really been laid o ut in order to support this
monopoly The expense f the ordinary peace establishment
. o

o f the c olonies amounted before the commencement o f t he ,

 1 12 T he W e al t h of N a t i o n s
p resent disturbances to the pay o f t wenty regiments o f foot ;
,

t o the expense o f the artillery stores and extraordinary r o

p , ,

v isions with which it was necessary to supply them and to the ,

e xpense of a very considerable naval force which w a constantly s

kept up in order to guard from the smuggling vessels o f other

, ,

n ations the immense coast o f N orth America and that f o ur

, ,
o

West Indian is l ands The whole expense f this peace estab

. o

li sh men t w a s a charge upon the revenue o f Great Britain and

,

w as at the same time the smallest part of what the dominion

, ,

o f the colonies has cost the mother country If w e would know .

t he amount of the whole w e must add to the annual expense

,

o f this peace establishment the interest o f the sums which i n

,

consequence o f her considering her colonies as provinces subj ect

t o her dominion Great Britain has upon di fferent occasions laid
,

o u t upon their defence We must add to it in particular the

.
, ,

w hole expense o f the late war and a great part of that of the ,

w ar which preceded it The late w ar was altogether a colony

.

q uarrel and the whole expense of it in whatever part of the

, ,

world it may have been laid out whether in Germany o the ,

r

E ast Indies ought j ustly to be stated t o the account f the

,
o

c olonies It amounted t o more than ninety millions sterling

.
,

i ncluding not only the n ew d eb t whi c h was contracted but the ,

t w o shillings in the pound additional land tax and the sums ,

w hich were every year borrowed from the sinking fund The .

S panish war which began in 739 was principally a colony

,
1 ,

quarrel Its principal object was to prevent the search of the

.

c olony ships which carried o n a contraband trade with the

S panish main This whole expense is in reality a bounty

.
, ,

w hich has been given in order to support a monopoly The .

pretended purpose f it was to encourage the manufactures and

o ,

t o increase the com m erce of Great Britain But its real e ffect .

h a s been to raise the rate of mer antile profit and t o enable c ,

ou r merchants to turn into a branch f trade o f which the o ,

r eturns are more slow and distant than those f the greater part o

o f other trades a greater proportion o f their capital than they

,

o therwise would have done ; two events whi h if a bounty c ,

c ould have prevented it might perhaps have been very well

,

worth while to give such a bounty .

Under the present system o f management therefore Great , ,

Britain derives nothing but 105 from the dominion which she 5

a ssumes over her colonies .

To propose that Great Britain should voluntarily give up all

a uthority over her colonies and leave them to elect their ,
w o n
 C o l o n i es I I
3
magistrates to enact their o wn laws and to make peace d
, ,
an

war as they might think proper would be to propose such a ,

measure as never w as and never will be adopted by any natio

, ,
n

in the world N o nation ever voluntarily gave up the dominio

. n

of any province how troublesome soever it might be to gover

,
n

it and ho w small soever the revenue which it afforded might b e

,

in proportion to the expense which it oc asioned Such sacri c .

fic e though they might frequently be agreeable t o the interest

s, ,

are always mo rtifying to the pride o f every nation and what is ,

perhaps of still greater consequence th ey are always contrary ,

to the private interest o f the governing part o f it who woul d ,

thereby be deprived o f the disposal o f many places of trust a d n

profit of many Opportunities o f acquiring wealth and d it i c

,
s n

tion which the possession o f the most turbulent and t o t he

, , ,

great body of the people the most unprofitable province seldo m

,

fails to afford The most visionary enthusiast would scarce b e

.

capable of proposing such a measure with any serious hopes a t

least of its ever being adopted If it was adopted however .
, ,

Great Britain would not only be immediately freed from t he

whole annual expense o f the peace establishment o f the colonies ,

but might settle with them such a treaty o f commerce as woul d

e ffectually secure to her a free trade more advantageous to t he ,

great body o f the people though less so to the merchants tha

, ,
n

the monopoly which she at present enjoys By thus parting .

good friends the natural affection o f the colonies to the mothe

,
r

country which perhaps o u late disse ns ions have well nigh

, ,
r

extinguished would quickly revive It might dispose them o t

, . n

o n ly to respect for whole centuries together that treaty o f

, ,

commerce which they had concluded with us at parting but t o ,

favour us in war as well as in trade and instead of turbulent , ,

and factious subjects to become our most faithful affectionate

, , ,

and generous allies ; and the same sort o f parental fiec t io n o a n

the o side and filial respect the other might revive betwee
ne ,
on ,
n

Great Britain and her colonies which used to subsist betwee , n

those o f ancient Greece n d the mother city from which they

a

descended .

In order to render any province advantageous to the e mpire

t o whi h it belongs it ought to afford in t i
c ,
me f peace a ,
o ,

revenue to the public su fficient not only for defraying the whol e
expense of its w n peace establishment but for contributing its
o ,

proportion to the support o f the general government f t he o

empire Every province necessarily contributes more or less

.
, ,

to increase the expense of that general government If any .

1 14 Th e W e al t h of N a t i o n s
p a rticular province therefore does not contribute,
its share ,

t owards defraying this expense an unequal burden must be ,

t hrown upon some other part of the empire The extraordinary .

r evenue too which every province a ffords to the public in time

, ,

of w ought from parity f reason to bear the same propor

ar , ,
o ,

t ion to the extraordinary revenue of the whole empire which its

o rdinary revenue does in time o f peace That neither the ordi .

nary nor extraordinary revenu which Great Britain derives e

from her colonies bears this proportion to the wh ole revenue o f

,

t h e British empire will readily be al lowed The monopoly it

, .
,

h a been supposed indeed by increasing the private revenue of

s , ,

t h e people f Great Britain and thereby enabling them to pay

o ,

g reater taxes compensates the

,
deficiency of the public revenue
o f the colonies But this monopoly I have endeavoured to
.
,

s how though a ve y grievous tax upon the colonies and though

,
r ,

it may increase the revenue of a particular order of men in

G reat Britain diminishes instead o f increasing that of the great
,

b ody of the people ; and consequently diminishes instead o f

increasing the ability of the great body of the people to pay

ta xes The men too whose revenue the monopoly increases

.
, , ,

c onstitute a particular order which it is both absolutely mp o s ,

i

s ible to tax beyond the proportion of other orders and extremely ,

impolitic even to attempt to tax beyond that proportion as I ,

s hall endeavour to show in the following book N o particular .

r esource therefore can be drawn from this particular order

, ,
.

The colonies may be taxed either by their o w assemblies o r n ,

b y the parliament of Great Britain .

That the colony assemblies can ever be so managed as to

levy upon their constituents a public revenue uflic ie t not s n

o n ly to maintain at all times their own civil and military estab

l ih men t but to pay their proper proportion o f the expense o f

s ,

t h e general government of the British empire seems n o t very

p robable It w a.s a long time before even the parliament of

England though placed immediately under the eye o f the
,

s overeign could be brought under such a system o f manage

,

m ent or could be rendered su fficiently liberal in their grants for

,

s upporting the civil and military establishments even o f their

o wn country It w a s only by distributing among the particular

.

members of parliament a great part either o f the o flic es or o f ,

the disposal o f the o flic es arising from this civil and military
e stablishment that such a system o f management could be
,

e stablished even with regard to the parliament of England .

But the distance o f the colony assemblies from the eye of the
 Co l o n i e s I I
5
s overeign their number their dispersed situation and their
, , ,

various constitutions would rende it very difficult to manage

,
r

them in the same manner even though the sovereign had the ,

same means o f doing it ; and those means are wantin g It o

.

would be absolutely impossible to distribute among all the lead

ing members o f all the colony assemblies such a share either f ,
o

the offices r f the disposal o f the flic e arising from the

o o o s

general government o f the British empire as to dispose them to ,

g ive up their popularity at home and to tax their constituents ,

for the support of that general government of which almost the ,

whole e moluments were to be divided among people wh were o

strangers to them The unavoidable ignorance o f adm inistra

.

tion besides concerning the relative importance of the different

, ,

members o f those d ifferent assemblies the o ff ences which must ,

frequently be given the blunders which must constantly be

,

committed in attempting to manage them in this manner seems ,

to render such a system of management altogether impracticable

with regard t them o .

The colony assemblies besides ca not be supposed the proper

, ,
n

j udges of what is ne essary for the defence

c and support of the
whole empire The care o f that defence and support is o t
. n

e ntrusted to them It is not their bus iness and they have no

.
,

regular means of inf ormation concerning it The assembly o f .

a province like the vestry o f a parish may judge very properly

, ,

c oncerning the aff airs o f its o w particular district ; but can n

have no proper means o f judging concerning those of the whole

e mpire . It c annot even judge properly concerning the pro
portion which its o w province bears to the whole empire ; o
n r

c oncerning the relative degree f its wealth and importance

'

c ompared with the other prov i n es ; because those other p o c r

vinces are not under the in spection and superintendency f the o

as sembly o f a particular province What is necessary for the .

d efence and support o f the whole empire and in what p o ,

r

portion each part ought to contribute can be judged of only ,

by that assembly which inspects and superintends the affairs

o f the whole empire .

It has been proposed a cordingly that the colonies should be

,
c ,

taxed by requisition the parliament o f Great Britain d et ermi

,
n

i n
g the sum whi h each colony ought to pay and the provin ial
c ,
c

assembly assessing and levying it in the way that suited best

the circumsta nces of the provi ce What c oncerned the whole n .

e mpire would in this way be determi ed by the asse mbly whi h n c

i n spects and superi ntends the affairs o f the whole empire ; and
1 16 T he W e al t h of N at i o n s
the provincial aff airs o f each colony might still be regulated by
its ow nassembly Though the co l onies should in this case
.

have no representatives in the British parliament yet if we , ,

may judge by experience there is no probability that the ,

parliamenta y requisition would be unreasonable The par lia

r .

ment of England has o t upon any occasion show the smallest

n n

disposition to overburden those parts o f the empire which are

n o t represented in parliament The is l ands of Guernsey and
.

Jersey without any m eans of resisting the authority o f parlia

,

ment are more lightly taxed than any part o f Great Britain
, .

Parliament in attempting to exercise its supposed right whether ,

well or ill grounded of taxing the colonies has never hithert o

, ,

demanded o f them anything which even approached to a just

proportion to what w as paid by their fellow subje ts at home -

c .

If the contribution o f the colonies besides was to rise or fall , ,

in proportion to the rise o fall o f the land tax parliament could

r ,

not tax them without taxin g at the same time its o w con n

st it u e t s and the colonies might in this case be considered a s

n ,

virtually represented in parliament .

Examples are not wantin g o f empires in which all the different

provinces are not ta xed if I may be allowed the expression in
, ,

o e mass ; but in which the sovereign regulates the um which

n s

each province ought to pay and in some provinces as sesses and

,

levies it as he thinks proper ; while in others he leaves it to b e ,

assessed and levied as the respe tive states o f each provinc c e

shall determine In some prov inces o f France the king not

.
,

only imposes what taxes he thinks proper but assesses and levies ,

them in the way he thinks proper From others he demands a .

certain sum but leaves it to the states o f each province to asses s

,

and levy that sum as they think proper Ac ordin g to the . c

scheme f taxing by requisition the parliament o f Great Britain

o ,

would stand nearly in the same situation towards the colony

assemblies as the King of France does towards the states o f
those provinces whi h still enjoy the privilege of having states
c

o f their o w the provin es o f France which are supposed to be

n, c

the best governed .

But though according to this s heme the colonies could hav e

,
c ,

no just reason to fear that their share of the public burden s

should ever exceed the proper proportion to that of their fellow
citizens at home ; Great Britain might have just reason t o fear
that it never would amount to that proper proportion Th . e

parliament o f Great Britain has not for some time past had the
same established authority in the colonies which the Fren h ,
c
 C o l o n i es i1
7
king has in those provinces o f France which still enjoy the
privilege o f having states o f their own The colony assemblies .
,

if they were not very favourably disposed (and unless more

skilfully managed than they ever have been hitherto they are ,

not very likely to be so ) might still find many pretences for

evading o rejecting the most reasonable requisitions o f parlia
r

ment A French wa breaks o ut we shall suppose ; ten millions

. r ,

must immediately be raised in order to defend the seat o f the

e mpire .This um must be borrowed upon the credit of some
s

parliamentary fund mortgaged for paying the interest Part .

o f this fund parliament proposes to raise by a tax to be levied

in Great Brita in and part of it by a requisition to all the different
,

colony assemblies of America and the West Indies Would .

p eople readily advance their money upon the credit o f a fund ,

which partly depended upon the good humour f all those o

a ssemblies far distant from the seat o f the war and sometimes
, , ,

perhaps thinking themselves not much concerned in the event

,

o f it ? Upon such a fund no m ore money would probably be

a dvanced than what the tax to be levied in Great Britain might
b e supposed t o answer for The whole burden o f the debt .

c ontracted o a count of the war would in this manner fall as

n c ,

it always has done hitherto upon Great Britain ; up on a part ,

o f the empire and o t upon the whole empire

,
n Great Britain .

is perhaps since the world began the only state which as it

, , , ,

has ext ended its empire has only in reased its expense without ,
c

o nce augmenting its resour c es Other states have generally .

d isburdened the mselves upon their subj ect and subordinate

p rovinces o f the most considerable part o f the expense f defend o

in g the empire Great Britain has hitherto suffered her subject

.

an d subordinate provinces to disburden themselves upon her of

a lmost this whole expense In order to put Great Britain upon .

a footing o f equ al ity with her own colonies which the law has ,

h itherto supposed to be subject and subordinate it seems ,

n ecessary upon the scheme f taxin g them by parliamentary

,
o

r equisition that parliament should have some means f render

,
o

i g its requisitions immediately effectual in case the colony

n ,

a s semblies should attempt to evade reject them ; and what or

those mean s are it is o t very easy to conceive and it has not

,
n
,

yet been explained .

Should the parliament f Great Britain at the same time o , ,

b e ever fully established in the right o f ta xin g the colonies even ,

n d ep e d e t o f the consent of their own assemblies the im

’

i n n ,

p ort a nce o f those semblies would from thatasm o me t b e at an n ,

_
1 1 8 T he W e alt h '

o f N at i o n s
end and with it that o f all the leading men o f British America
, , .

Men desire to have some share in the management of public

affairs chiefly o a count of the importance which it gives them
n c .

Upon the power whi h the greater part of the leading men t he
c
,

natural aristocracy o f every country have of preserving o , r

defending their respective importa nce depends the stability ,

and duration of every system o f free government In t he .

atta ks which those leading men are continually making upon

c

the importance f one another and in the defence o f their o w

o , n,

consists the whole play o f domestic fa tion and ambition Th c . e

leading men o f America like those of all other countries desire

, ,

to preserve their o w importan e They feel or imagine that

n c .
, ,

if their assemblies which they are fond of calling parliaments

, ,

and o f considering as equal in authority to the parliament o f

Great Britain should be so far degraded as to become t he
,

humble ministers and executive o flic e s of that parliament t he r ,

greater part o f their o w importance would be at end They n .

have rej ected therefore the proposal o f being taxed by parlia

, ,

mentary requisition and like other ambitious and high spirited

,
-

men have rather chosen to draw the sword defence of their

,
In

ow importance
n .

Towards the declension o f the Roman republic the allies o f ‘

Rome w ho had borne the principal burden o f defending t h

,
e

state and extending the empire demanded to be admitted t o ,

all the privileges o f Roman citizens Upon being refused t he .

,

social w broke o u t During the course o f that wa Rom e

ar . r,

granted those privileges to the greater part f them one by o

o e and in proportion as they detached themselves from t he

n ,

general onfederacy The parliament o f Great Britain insists

c .

upon ta xing the colonies ; and they refuse to be taxed by a

parliament in which they are not represented If to each .

c olony which should detach itself from the general confederacy

, ,

Great Britain should allow such a number o f representative s

as suited the proportion o f what is contributed to the publi c
revenue o f the empire in consequence o f its being subjected t o
,

the same taxes and in compensation admitted to the sam e

,

freedom o f trade with its fellow subjects at home ; the numbe -

r

o f its representatives to be augmented as the proportion o f i t s

contribution might afterwards augment ; a new method o f

acquiring importance a ew and more dazzling object f ,
n o

ambition would be presented to the leading men o f each colony .

Instead o f piddling for the little prizes which are to be found

in what may be called the paltry ra ffle o f colony faction ; the y
 C olo n i es I 1
9
might then hOp e from the presumption which men naturally
,

have their o w ability and good fortune to draw some o f t he

In n ,

great prizes which sometimes come from the wheel o f the great
state lottery of B ritish politics Unless this or some othe . r

method is fallen upon and there seems to be none more obvious

,

than this of preserving the importance and f gratifying t he

,
o

ambition of the leading men o f America it is not very probabl e ,

that they will ever voluntarily submit to us ; and w ought t e o

consider that the blood which must be shed in forcing them to

do so is eve y drop o f it the blood either of those wh o e
,
r ,
ar ,
or

o f those whom we wish to have for o u r fellow citizens They -

are very weak wh flatter themselves that in the state to whi h

o ,
c

things have come u colonies w ill be easily conquered by for e

,
o r c

alone The persons who now govern the resolutions o f what

.

they c all their continental congress feel in themselves at thi s ,

moment a degree o f importance which perhaps the greates t , ,

subjects in Europe scarce feel From shopkeepers tradesmen .

, ,

and at t o rnies they are become statesmen and legislators and

, ,

are employed i contriving a ew form of government for an

n n

extens ive empire which they flatter themselves will become

, , , ,

and which indeed seems ve ry likely to become o

, ,
f t he ,
ne o

greatest and most formidable that ever was in the world Five .

hundred di fferent people perhaps who in di fferent ways c t , ,

a

immediately under the continental congress ; and five hundre d

thousand perhaps who c t under those five hundred all feel in
, ,
a ,
.

the same mann er a proportionable rise in their w importan e o n c

Almost every individual o f the governing party in Am erica

fills at present in his o w n fancy a station supe rior not only
, , ,

to what he had ever filled before but to what he had eve r , ,

expected t o fill ; and unless some new object of ambition is

presented either to hi m o to his leaders if he has the ordinary r ,

spirit o f a man he will die in defence o f that station

, .

It is a remark of t he president He ut that w e n o w rea d na ,

with pleasure the account o f many little transactio s o f t he n

Ligue which when they happened were o t perhaps considere d

,
n

as very important pieces of news But eve y man then says . r ,

he fancied himself o f some importance ; and the innumerable

,

memoirs which have come down t o us from those times were , ,

the greater part f them written by people w ho took pleasure

o ,

in recording and magnifying events in which they flattere d ,

.

themselves they had been considerable a tors Ho w obstinately

,
c .

the city o f Paris upon that occasion defended itself what a ,

dreadful famine it supported rather than submit to the bes t '

 20 The W e al t h o f N at i o n s
and afterwards to the most beloved o f all the French kings is ,

well known The greater part o f the citizens r those who

.
,
o

g overned the greater part o f them fought in defence o f their o w , n

importance which they foresaw wa s t be at an end whenever

,
o

t he ancient government should be re establi shed O ur colonies -

.
,

u nless they can be induced to consent t o a union are very likely ,

to defend themselves against the best o f all mother countries

a s obstinately as the city of Paris did against o e o f the best n

o f kings .

The idea of representation was unknown in ancient times .

When the people f o e state were admitted to the right of

o n

c itizenship in another they had no other means o f exercising ,

t hat right but by coming in a body to vote and deliberate with

t he people o f that other state The admission o f the greater .

p art o f the inhabitants o f Italy to the privileges o f Roman

c itizens completely ruined the Roman republic It wa no . s

l onger possible to distinguish between who w a s and who was

n o t a Roman citizen N o tribe could know its o w members
. n .

A rabble o f any kind could be introduced into the assemblies f o

the people could drive o u t the real citizens and decide upon the
, ,

affairs o f the republic as if they themselves had been such But .

t hough America were to send fifty o sixty new representatives r

to parliament the doorkeeper of the House o f Commons could

,

c ould not find any great d i flic ult y in distinguishing between

who w a s and who w a not a member Though the Roman c o n s .

s tit ut i
o therefore w s necessarily ruined by the union o f
n, ,
a

Rome with the allied states of Italy there is not the least ,

p robability that the British constitution would be hurt by the

u nion of Great Britain with her colonies That constitution .
,

o n the contrary would be completed by it and seems t o be

, ,

imperfect without it The assembly which deliberates and .

decides concerning the affairs o f every part of the empire in order ,

t o be properly informed ought certainly to have representatives ,

from every part o f it That this union however could be easily

.
, ,

e ffectuated o r that d i fli
,
c ult ie and great di fficulties might n o t s

o ccur in the execution I do not pretend I have yet heard f ,

. o

n one however which appear insurmountable The principal

, ,
.

perhaps arise not from the nature f things but from the
,
o ,

prejudices and opinions o f the people both o this and o n the n

o ther side o f the Atlantic .

We o this side the water are afraid lest the multitude o f

,
n ,

American representatives s h ould overturn the balance of the

c onstitution and increase too much either the influence o f the
,
 C ol o n i es I 2 1

crown on t he o e hand o r the force o f the democracy o the

n ,
n

other But if the umb e o f American representatives were to

'

. n r

be in proportion to the produce o f American taxation the ,

number o f people to be managed would increase exactly in

propo rtion to the means o f managing them ; and the means o f
managing to the number o f people to be managed The .

monarchical and democratical parts o f the constitution would ,

after the union stand exactly in the same degree of relative

,

force with regard to one another as they had done before .

The people the other side f the water are afraid lest their
on o

distance from the seat o f govern ment might expose them to

many p p e s io s But their representatives in parliament o f
O r s s n .
,

which the number ought from the first to be considerable would ,

easily be able to protect them from all Oppression The distance .

could not much weaken the dependency o f the representa tive

upon the constituent and the former would still feel that he
,

owed his seat in parliament and all the consequences which he ,

derived from it to the good will of the latter It would be the

,
.

interest o f the former therefore to cultivate that goodwill by

, ,

complain ing with all the authority f a member o f the legislature

,
o
,

o f every outra e which any civil r military officer might be

g o

gu il ty of in those remote parts f the empire The distance o f o .

America from the seat of gove rnment besides the natives o f , ,

that country might flatter themselves with some appearance ,

o f reason too would not be o f very long continuance Such

, .

has hitherto been the rapid progress f that country in wealth o

,

population and improvement that in the course f little more

, ,
o

than a century perhaps the produce o f American might exceed

, ,

that o f British taxation The seat f the empire would then. o

naturally remove itself to that part o f the empire which con

tributed most to the general defence and support o f the whole .

The discovery o f America and that o f a passage to the East ,

Indies by the Cape of Good Hope are the two greatest and most ,

important events recorded in the history o f mankind Their .

consequences have already been ve ry great ; but in the short ,

period o f between two and three centuries which has elapsed

since these discoveries were made it is impossible that the whole ,

extent f their consequences can have been seen What benefits

o .

or what misfortunes to man kind may hereafter result from those

gr eat events no human wisdom can foresee By uniting in
, .
,

s om e measure the most distant parts o f the world by enabling

, ,

t hem to relieve o n another s wants to increase o e another s

’ ’
e , n

enjoyments and t o encourage one another s industry , their

,
’

11 E
122 The W e al t h of N at i o n s
general tendency would seem to be beneficial To the natives .

however both o f the Eas t and West Indies all the commercial
, ,

benefits which can have resulted from those events have been
sunk and lost in the dreadful misfortunes which they have
occasioned These misfortunes however seem to have arisen
.
, ,

rather from accident than from anyth ing in the nature o f those
events themselves At the particular time when these dis
.

co e i
v es were made the superiority of force happened to be so
r ,

great o the side o f the Europeans that they were enabled to

n

commit with impunity every sort o f injustice in those remote

countries Hereafter perhaps the natives o f those countries
.
, ,

may grow stronger o r those f Europe may grow weaker and

,
o ,

the inhabita nts o f al l the d ifl e e t quart ers o f the world may

r n

arrive at that equality o f courage and force which by inspiring ,

mutual fear can alone overawe the injustice o f independent

,

nations into some sort o f respect for the rights o f o e another n .

But nothing seems more likely to establish this equality o f force

than that mutual communication o f knowledge and o f all sorts
o f improvements which an extensive commerce from all countries

to all countries naturally o r rather necessarily ca rries along

, ,

with it .

In the meantime o n e o f the principal eff ects o f those d is

‘

co ve i
res has been to raise the merca nt i l e system to a degree o f
S plendour and glory which it could never otherwise have attain ed

to It is the object o f that system to enrich a great nation

.

rather by trade and manufactures than by the improvement

and cultivation of land rather by the industry o f the towns
,

than by that o f the c ountry But in consequence o f those .

,

discoveries the commercial towns o f Europe instead o f being

, ,

the manufacturers and carriers for but a very small part of the
world (tha t part f Europe which is washed by the Atlantic
o

O cean and the countries which lie round the Baltic and Medi
,

terranean seas ) have n o w become the manufacturers for the

,

numerous and thr ivin g cultivators o f Am erica and the carriers , ,

and in some respe ts the manufa turers too fo almost all the
c c ,
r

different nations o f A sia Africa an d America Tw o new worlds

, ,
.

have been Opened t o their industry each of them much greater ,

and more extensive than the old o and the market o f o e n e, n

o f them growing still greater and greater every day .

The countries whi ch possess the colonies o f Am erica and ,

w hich trade d i
rectly t o the East Indies enjoy indeed the whole , , ,

show and splendour o f this great ommerce O ther countries c .

,

however notwithsta nding all the invid i ous restraints by which

,
 C olo n i es 12
3
it is meant to exc lude them frequently enjoy a greater share o f
,

the real benefit o f it The c olonies o f Spain and Portugal fo r

.
,

example give more real encouragement to the industry of other

,

c ountries than to that of Spain and Portugal In the single .

article f li en alone the onsumption of those colonies amounts

o n c ,

it is said but I do t pretend to warrant the quanti t y to more

,
no ,

than three millions sterling a year But this great onsumption . c

is almost entirely supplied by France Flanders Holland and , , ,

Ge rmany Spain and Portugal furnish but a small part of it

. .

The capital which supplies the colonies with this great quantity
o f linen is annually distributed among and furni shes a revenue ,

t o the inhabitants o f those other c ountries

,
The profits o f it .

only are spent in Spain and Portugal where they help to supp ort ,

the sumptuous profusion of the m erchan ts f Cadiz and Lisbon o .

Even the regulations by which each nation endeavours to

secure to itself the exclusive trade of its o w colonies are n

frequently more hurtful t o the countries in favour o f which

they are established than to those against which they are
established The unjust Oppression o f the industry o f other
.

countries fall s back if I may say so upon the heads of the

, ,

oppressors and crushes their industry more than it does that

,

o f those other countries By those regulations for example

.
, ,

the merchant o f Hamburg must send the linen which he

des tines fo the Ameri an market to London and he must
r c ,

bring back from thence the toba o which he destines for the cc

German market because he can neither send the e directly

,
on

to America bring ba k the other directly from thence By

nor c .

this restraint he is probably obliged to se ll the one somewha t

cheaper and to buy the other somewhat dearer than he other
,

w ise might have done ; and his profits are probably somewhat
abridged by means f it In this trade however between
o .
, ,

Hamburg and London he certainly receives the returns of his

,

capital much more quickly than he could possibly have done

in the direct trade to Am erica even though we should suppose , ,

w hat is by o m eans the case that the payments of A merica

n ,

were as pu ctual as those of London In the trade therefore

n .
, ,

to which those regulations confine the mercha nt o f Hamburg ,

his capital c an keep in co n stant employment a much grea t er

q uantity o f German indus t ry than it possibly could have done

in the trade from which he is excluded Though the o employ . ne

ment therefore may to him perhaps be less profitable than the

, ,

o ther it cann ot be less advantageous to his coun t ry It is

,
.

quite otherwise with the employment into which the monopoly

1 24 Th e W eal t h of N at i o n s
naturally attra ts if I may say so the capital of the London
c , ,

merc hant That employment may perhaps be more profitable

.
, ,

to him than the greater part o f other employments but , ,

on

ac ount f the slowness f the returns it annot be more dv a

c o o ,
c a n

t g o u to his country
a e s .

After all the unjust attempts therefore f every country in , ,

o

E u rope to engross to itself the whole advantage o f the trade o f

its own colonies country has yet been able to engross t o itself
,
no

anything but the expense of supporting in time of peace and

of defending in time o f war the oppressive authority which it
assumes over the m The inconvenien ies result ing from the. c

possession o f its colonies every country has engrossed to itself ,

completely The advantages resulting from their trade it has

.

been obliged to share with many other countries .

At first sight no doubt the monopoly o f the great commerce

, ,

Of America naturally seems to be an acquisition o f the highest

value To the u d isc em ig eye o f giddy ambition it naturally
. n n
,

presents itself amidst the onfused scramble o f politics and war c

as a very dazzling object to fight f The dazzling splendour or .

o f the object however the immense greatness o f the

,
ommerce
,
. c ,

is the very quality which renders the monopoly of it hurtful o ,

r

whi h makes n e employment in its o w nature necessarily less

c o ,
n

advantageous to the country than the greater part f othe o r

employments absorb a mu c h greater proportion o f the capital

,

o f the country than what would otherwise have gone to it .

The mercantile stock o f every country it has been shown in ,

the second book naturally seeks i f o ne may say so the employ

, , ,

ment most advantageous to that country If it is employed in .

the carrying trade the country to which it belongs becomes t he

,

emporium o f the goods o f all the ountries whose trade that stock c

carries on But the owner o f that stock necessarily wishes t o

.

dispose o f as great a part of those goods as he can at home He .

thereby saves himself the trouble risk and expense f exporta , ,

o

tion and he will upon that account be glad to sell them at home
, ,

not only for a much smaller price but with somewhat a smaller ,

profit than he might expect to make by sending them abroad .

He natu rally therefore endeavours as much as he can to turn

, ,

his carrying trade into a foreign trade o f consumption If his .

stock again is employed in a foreign trade o f consumption he

, , ,

will for the same reason be glad to dispose o f at home as great

, ,

a part as he can o f the home goods which he collects in order to ,

export to some foreign market and he will thus endeavour as , ,

much as he can to turn his foreign trade o f consumption into a

,
 C o l o n i es 125

home trade The mercantile stock of every country naturally

.

courts in this manner the near and shuns the distant employ ,

ment ; naturally courts the employment in which the returns

are frequent and shuns that in whi h they are di tant and slow ;
,
c s

naturally ourts the employment in whi h it

c maintain the c c an

greatest quantity of productive labour in the country to which

it belongs o in which its owner resides and shuns th t in which
,
r ,
a

it maintain there the smallest quantity It naturally courts

can .

the employment whi h in ordinary cases is most advantageous

c ,

and shuns t hat which in ordinary cases is least advantageous

to that ountry c .

But if in any o f those distant employments whic h in ordinary ,

cases are less advantageous to the country the profit should ,

happen to rise somewhat higher than what is sufficient to balance

the natural preference which is given to nearer employments this ,

superiority o f profit will draw sto c k from those nearer employ

ments till the profits of all return to their proper level This
,
.

superiority of profit however is a proof that i the a c tual

, , ,
n

c ircumstances of the so iety those distant employments are

c ,

somewhat understo ked in proportion to other employments

c ,

and that the stock o f the society is not distributed in the

properest man ner among all the different employments carried
o nin it It is a proof that something is either bought heaper
. c

o sold dearer than it ought to be and that some particular class

r ,

o f citizens is more or less oppressed either by paying more or by

getting less than what is suitable to that equality whi h ought c

to take place and which naturally does take place among all
,

the different c lasses f them Though the same capital never

o .

will maintain the same quantity of productive labour in a distant

as in a near employment yet a distant employment may be as,

n ecessary for the welfare o f the so c iety as a near o ; the goods ne

which the distant employment deals i being ec e ai y perhaps n n ss , ,

for carrying o many o f the nearer employments But if the

n .

profits of those who deal in such goods are above their proper
level those goods will be sold dearer than they ought to be or
, ,

somewhat above their natural price and all those engaged in the ,

nearer employments will be more or less oppressed by this high

price Their interest therefore in this case requires that some
.
, ,

s tock should be withdrawn fro m those nearer employments

‘

an d turned towards that distant one in order to red u e its , c

profits to their proper level and the price of the goods whi c h it
,

deals in to their natural pri c e In this extraordinary ase the . c ,

public interest requires that some stock should be withdrawn

1 26 Th e
W eal t h of N a t i o n s
from those employment which in ordinary cases are more
s

advanta geous and turned towards o e which in ordinary cases

,
n

is less advantageous to the public ; and in this extraordinary

case the natural interests and inclinations o f men coincide as
exactly with the public interest as in all other ordinary cases and ,

lead them to withdraw stock from the near and to turn it ,

towards the distant employment .

It is thus that the private interests and passions o f individuals

naturally dispose them to turn their stock towards the employ
ments which in ordinary cases are most advantageous to the
society But if from this natural preference they should turn
.

t o o much o f it towards those employments the fall o f profit in ,

them and the rise of it in all others immediate l y dispose them

to alter this faulty distribution Without any intervention o f
.

law therefore the private interests and passions o f men natur

, ,

ally lead them to divide and distribute the stock o f every

society among al l the di fferent employments carri ed o in it n

as nearly as possible in the proportion which i s most agreeabl e

to the interest o f the whole society .

All the different regulations o f the mercantile sy stem n eces

sa ri ly derange more o r less th i s natural and most advantageou s
d istribution o f stock But those whi ch concern the trade t o
.

America and the East Indies derange it perhaps more than any
other because the trade to those t wo great continents absorbs
,

a greater quantity o f stock than any t wo other branches o f

trade The regulati ons however by which thi s derangement
.
, ,

is efl ec t ed in those two di ff erent branches o f trade are not

altogether the same Monopoly is the great engine o f both ;
.

but it is a di fferent sort o f monopoly Monopoly o f o e kind . n

o r another indeed seems to be the sole en gine o f the mercantile

, ,

system .

In the trade to America every nation endeavours to engross

as much as possible the whole market of its o wn colonies by
fairly excluding al l other nations from any direct trade to them .

During the greater part o f the sixteenth century the Portugues e ,

endeavoured to manage the trade to the East Indies in the same

manner by claiming the sole right o f sailing in the Indian seas
, ,

o n account o f the merit o f having first found u t the road to o

them The Dutch still continue to exclude all other European

.

nations from any direct trade to thei r spice islands Monopo lies .

of this kind are evidently established against all other European

nations who are thereby not only excluded from a trade to
,
‘

which it might be convenient for them to turn some part of

 C o l on i es 12
7
their stock but are o b liged t o buy t he goods which that trade
,

deals in somewhat dearer than if they could import them

thems elves directly from the countries which produce them .

But since the fall o f the power of Portugal no European ,

nation has claimed the exclusive right of sai ling in the Indian
seas o f which the principal ports are o w Open to the ships o f
,
n

all European nations Except in Portugal however and within

.
, ,

these few years in France the trade to the East Indies has in
,

every European country been subj ected to an exclusive com

pany M onopolies o f this k ind are properly estab lished against
.

the very nation which erects them The greater part o f that
.

nation are thereby not only excluded from a trade to which it

might be convenient for them to turn some part o f their stock ,

but are obliged to buy the goods which that trade deals in
somewhat dearer than if it wa s open and free to all their country
men Since the estab lishment o f the English East India Co m
.

pany for example the other i n habitants o f England over and

, , ,

above being excluded from the trade must have paid in the
,

price o f the Eas t In dia goods which they have consumed not ,

only for all the extraordin ary profits which the company may
have made upon those goods in consequence o f their monopo ly ,

but for all the extraordinary waste which the fraud and abuse ,

inseparable from the management o f the affairs o f so great a

company must necessarily have occasioned The absurdity o f
, .

this second kind of monopoly therefore is much more manifest

, ,

than that o f the first .

Both these k inds of monopolies derange more o r l ess the

natural distribu t ion o f the stock of the society ; but they do
not always derange it in the same w ay .

Monopo lies o f the first kind always attract to the particular

trade in which they are estab lished a greater proportion o f the
stock o f the society than what would go t that trade of it s o

own accord .

M onopolies o f t he second kind may sometimes attract stock

towards the particular trade in which they are established and ,

sometimes repel it from that trade according to di fferent cir

c umst a ces
n In poor countries they naturally attract towards
.

that trade more stock than would othe rwise go to it In rich .

countries they naturally repel from it a good deal of stock

which would othe rwise go to it .

Such poor countries as Sweden and Denmark fo exampl e ,

r ,

would probably have never sent a single ship to the East Indies
had not the trade been subjected t o an exclusive company .
128 The W e al t h of N at i o n s
The establishment o f such a company necessarily encourages
adventurers The i r monopoly secures them against all c o m
.

p e t i
t o r in the home market and they have the same chance
s ,

for foreign markets with the traders of other nations Their .

monopoly shows them the certainty o f a great profit upon a

considerable quantity o f goods and the chance of a considerable
,

profit upon a great quantity Without such extraordinary

.

encouragement the poor traders of such poor countries would

,

probably ne ver have thought o f ha arding their small capitals z

in so very distant and uncertain an adventure as the trade to

the East Indies must naturally have appeared to them .

Such a rich country as Holland o the contra y would prob ,

n r ,

ably i the case o f a free trade send many more ships to the
,
n ,

East Indies than it actually does The limited stock o f the .

Dutch East India Company probably repels from that trade

many great mercantile capitals which would otherwise go to it .

The mercantile capital o f Holland is so great that it is as it ,

were continually overflowing sometimes into the public funds

, ,

o f foreign countries sometimes into loans to pri vate traders and

,

adventurers of foreign countries sometimes into the most ,

round about foreign trades of consumption and sometimes into

-

the carry ing trade All near employments being completely

.

filled up all the capital which can be placed in them with any
,

tolerable profit being already placed in them the capital o f ,

Holland necessarily flows towards the most distant e mploy

ments The trade to the East Indies if it were altogether free
.
, ,

would probably absorb the greater part f this redundant c apital o .

The East Indies o ff er a market both f r the manufactures f o o

Europe and for the gold and silver as well as for several other
produ tions o f America greater and more extensive than both
c

Europe and America put together .

Every derangement o f the natural distribution o f stock is

necessarily hurtful to the society in which it takes place ;
whether it be by repelling from a particular trade the stock
which would otherwise go to it or by attracting towards a ,

particular trade that which would not otherwise come to it If .

,

without any exclusive company the trade of Holland to the ,

East Indies would be greater than it actually is that country ,

must su ffer a considerable loss by part of its capital being

excluded from the employment most convenient fo r that part .

And in the same manner if without an exclusive company the

, , ,

trade of Sweden and Denmark t o the East Indies would be less

than it actually is o r what perhaps is more probable would
, , ,
 C o lo n i es 1 29

not exist at all those two countries must like wi se su ff er a

,

co iderable loss by part o f their capital being drawn into an

ns

employment whic h must be more o less unsuitable to their r

present circu mstances Better fo them perhaps in their pre . r , ,

sent circumstances t buy East India goods o f other nations ,

o ,

even though they should pay somewhat dearer than to tur so ,

n

great a part of their small capit l to so very distant a trade in a ,

which the returns are so very slow in which that capita l can ,

maintain so s mall a quantity o f productive labour at home ,

where productive labour is so much wanted where so little is ,

done and where so much is to do

,
.

Though w ithout an exclusive company therefore a particular , ,

country should not be able to carry any direct trade to the on

East Indies it will not from thence follow that such a company
,

ought to be established there but only that su h a ountry ought ,

c c

not in these circumstances to trade directly t o the East Indies .

That such c ompanies are o t in general necessary fo carrying n r

on the East India trade is uflicie t ly demonstrated by the s n

expe rience f the Portuguese who enj oyed almost the whole o f
o ,

it for more than a centu y together without any exclusive r

company .

N o private merchant it has been said could well have capital , ,

su ffi ient to m aintain factors and agents in the different ports

c

o f the East Indies in order to provide goods for the s hips ,

which he might o casionally send thither ; and yet unless he

c ,

w a able to do thi
s s the difficulty o f finding a cargo might fre
,

quently make his ships lose the season for returning and the ,

expense of so long a delay would not o n ly eat up the whole

profit o f the adventure but frequently o sion a very c o n ,
c ca

sid b l loss
era This argument however if it proved anything
e .
, ,

at all would prove that no

, great branch o f trade could be o ne

carried without an exclusive o mpany whih is contrary t o

on c ,
c

the experien e f all nations There is no great bran h of trade

c o . c

in whi h the capital f any one private mer hant is su ffi ient

c o c c

fo ca ryi g on all the subord i

r r n nate bran hes whi h must be c c

ca rried in order to carry o the prin ipal one But when a

on, n c .

nation is ripe for any great branch of trade some mer hants ,
c

naturally turn their apitals towards the principal and some c ,

towards the subordinate bran hes of it ; and though all the c

di fl e e t bran hes o f it are in thi

r n s manner carried o yet it
c n,

very seldom happens that they are all ca rried by the ca pital on

o f o e private merchant
n If a nation therefore is ripe for the .
, ,

East India trade a c ertain portion f its apital will natu rally
,
o c

II E 2
1
30 The W eal t h of N a t i o n s
divide itself among all the d ifl eren t branches o f that trade .

Some o f its merchants wi ll find it fo r their interest t o reside in

the East Indies and to employ their capitals there i providin g
, n

goods fo r the ships which are t o be sent o ut by other merchants

w ho reside in Europe The settlements which different Euro
.

pean nations have obtained in the East Indies if they were ,

taken from the exclusive ompanies t o which they at present

c

belong and put under the immediate protection f the sove o

reign would render this residence both safe and easy at least
, ,

to the mer hants o f the particular nations to whom those settle

c

ments belong If at any particular time that part o f the capital

.

o f any country which of its o wn accord tended and inclin ed if ,

I may say 5 0 towards the East India trade was not suflic ie t
, , n

fo r carrying o all those different branches of it it wou l d be a

n ,

proof that at that particular time that country was not ripe
, ,

fo r that trade and that it would do better to buy fo r some

,

time even at a higher price from other European nations the

, , ,

East India goods it had occasion fo than to import them itself r,

directly from the East Indies What it might lose by the high .

price o f those goods ould seldom be equal to the loss which it

c

would sustain by the distra tion of a large portion o f its capital

c

from other emp l oyments more necessary o more useful o ,

r ,
r

more suitable to its circumstances and situation than a d irect ,

trade to the East Indies .

Though the Europeans possess many considerable settle

ments both upon the coast f Africa and in the East Indies o ,

they have not yet established in either f those countries such o

numerous and thriving olonies as those in the islands and c o

c n

t ien t o f A merica
n Africa however as well as several o f the
.
, ,

countries comprehended under the general name of the East

Indies are inhabited by barbarous nations But those nations
,
.

were by no means so weak and defenceless as the miserable and

helpless Americans ; and in proportion t o the natural fertility
o f the countries which they inhabited they were besides much ,

more populous The most barbarous nations either of Africa o r

.

o f the East Indies were shepherds ; even the Hottentots were

so But the natives of every part of America except Mexico

.
,

and P eru were only hunters ; and the difference is very great
,

between the number o f shepherds and that o f hunters whom

the same extent o f equally fertile territory can maintain In .

A frica and the East Indies therefore it w as more di fficult to, ,

displace the natives and to extend the European plantations

,

over the greater part f the lands o f the original inhabitants

o .
 Co l o n i e s I
3 I

The genius o f exclusive companies besides is unfavourable it , , ,

has already been obse r ved to the growth o f new colonies and , ,

has probably been the princip al cause f the little progress o

which they have made in the East Indies The Portuguese .

carried o n the trade both to Af ri a and the East Indies without c

any exclusive companies and their settlement at Congo Angola

,
s , ,

and Benguela on the coas t f Afri a and at Goa in the East o c ,

Indies though much depressed by superstition and every sort

,

o f bad government yet bear some fain t resemblan e to the

,
c

colonies of America and are partly inhabited by Portuguese

,

w ho have been established there for several generations The .

Dutch settlements at the Cape of Good Hope and at Batavia

are at present the most considerable colonies which the Euro
peans have established either in Africa r in the East Indies o ,

and both these settlements are peculiarly fortunate in their

situation The Cape o f Good Hope was inhabited by a ra e of
. c

people almost as barbarous and quite as in c apable o f defendin g

themselves as the natives of America It is besides the half .

way house if o e may say 0 between Europe and the E as t

,
n 5 ,

Indies at which almost every European ship makes some stay

, ,

both in goin g and returning The supplying o f those ships with .

every sort o f fresh provis ons with fruit and sometimes with i ,

wine affords alone a very extensive market for the surplus

i
,

p rod ic e o f the olonists What the Cape o f Good Hope is

c .

between Europe and every part of the Eas t Indies Batavia is ,

between the prin ipal countries of the East Indies It lies upon
c .

the most frequented road from Indostan to China and Japan ,

and is nearly about midway upon that road Almost all the .

ships too that sail between Europe and China touch at Bata via
, ,

and it i over and above all this the entre and pri cipal mart
s, ,
c n

o f what 5 called the country trade o f the East Indies not only
1
,

o f that part o f i t whi h arried on by Europeans but o f that

c 15 c
,

which carried by the native Indians ; and vessels navigated

15 on

by the inhabita nts o f China and Japa f Tonquin Mala a n, o ,

cc ,

Cochin China and the isla d of Celebes are frequently to be

-

,
n ,

seen in its port Such advanta geous situations have enabled

.

those t w colonies to surmount all the obsta les whi h the

o c c

Oppressive genius o f an exclusive ompany may have occa c

si o lly opposed to their growth

na They have enabled Batavia .

t o su mount the additional disadvantage o f perhaps the most

r

unwholesome c limate in the world .

The English and Dutch companies though they have esta b ,

lihed no considerable colonies except the t w o above mentioned

s
, ,
1
32 The W eal t h of N a t i o n s
have both made considerable conquests in the East Indies .

But in the manner in whi h they both govern their new sub c

j ec t the natural genius f an exclusive company has shown

s, o

itself m ost distin tly In the spice islands the Dutch are said
c .

t
o burn all the spi c eries whi h a fertile season produces beyond c

what they expect to dispose o f in Europe with such a profit as

they think su fli i t In the islands where they have no settle
c en .

ments they give a premium to those who collect the young

,

blossoms and green leaves f the love and nutmeg trees whi h o c c

naturally grow there but which this savage poli y has now it
,
c ,

is said almost completely extirpated Even in the islands

,
.

where they have settlements they have very mu h reduced it is c ,

said the number o f those trees If the produ e even of their

,
. c

ow islands w a much greater than what suited their market

n s ,

the natives they suspect might find means t o convey some part
, ,

o f it to other nations ; and the best w y they imagine to secure a , ,

their own monopoly is to take care that no more shall grow

than what they themselves carry to market By different ar t s .

o f oppression they have redu ed the population o f several o f the c

Moluccas nearly to the number whi h is suflic ie t t supply c n o

with fresh provisions a d o t h ne essaries f life their o wn n _

er c o

insignifi ant garrisons and su h o f their ships as occasionally

c ,
c

come there f a cargo f spices Under the government even

or o .

o f the Portuguese however those islands are said to have been

, ,

tolerably well inhabited The English ompany have not yet . c

had time to establish in Bengal so perfectly destru c tive a system .

The plan o f their gover m ent however has had exactly the n , ,

same tenden y It has o t been un ommon I am well assured

c . n c , ,

f
or the hief that is the first clerk of a fa tory to order a
c , ,
c ,

peasant to plough up a rich field o f poppies and sow it with ,

ri c e some other grain The preten e was to prevent a

or . c ,

scarcity f provisions ; but the real reason to give the chief an

o ,

opportunity of selling at a better pri e a large quantity o f c

opium w hi h he happened then to have upon hand Upon

,
c .

other o asions the order has been reversed ; and a rich field of
cc

rice o other grain has been ploughed up in order to make room

r ,

fo a plantation f poppies ; when the chief foresaw that extra

r o

ordinary profit was likely to be made by opium The servants .

o f the c ompany have u pon several o c casions attempted to

establish in their o w favour the monopoly of some o f the most

n

important branches not only o f the foreign but of the inland

, ,

trade f the country Had they been allowed to go

o . it is on,

impossible that they should not at some time or another have

 C o l o n i es 1 33
attempted to restrain the production of the particular articles
o f whi ch they had t hus usu ped t he monopoly not only to the r ,

quantity which they themselves could purchase but to that ,

which they ould expect to sell with such a profit as they

c

might think sufficient In the course of a century or two .

,

the poli y of the English company would in this manner

c

have probably proved as completely destru tive as that of c

the Dutch .

N othing however can be more directly contrary to the real

, ,

interest of those companies considered as the sovereigns of the ,

countries which they have conquered tha n this destructive plan , .

In almost all countries the revenue of the sovereign is drawn

from that f the people The greater the revenue of the people
o .
,

therefore the greater the annual produce of their land and

,

labour the more they can afford to the sovereign It is hi

,
. s

interest therefore to increase as much as possible that annual

, ,

produce But if this is the interest of every sovereign it is

.
,

peculiarly so of o e whose revenue like that of the sovereign f

n ,
o

Bengal arises chiefly from a land rent That rent must meces
,
-

sa i
r ly be in proportion to the quantity and value of the produce ,

and both the one and the other must depend upon the extent
o f the market The quantity will always be suited with more or
.

less exactness to the consumption of those who can afford t o

pay f r it and the price which they will pay will always be
o ,

in proportion to the eagerness of their competition It is the .

interest o f such a sovereign therefore to Open the most extensive

market for the produce f his c ountryto allow the most perfect
, ,

o ,

freedom of commerce in order to increase as much as possible

,

the number and the competition of buyers ; and upon this

account to abolish not only all monopolies but all restraints
, ,

upon the transportation of the home produce from one part o f

the country to another upon its exportation to foreign countries
, ,

o r upon the importation of goods f any kind f which it can o or

be exchanged It is in this manner most likely to increase both

.

the quantity and value o f that produce and consequently of ,

his own share of it or o f his own revenue

,
.

But a company f merchants are it seems incapable f con

o , ,
o

si d erig themselves as sovereigns even after they have become

n ,

such Trade or buying in order to sell again they still consider

.
, ,

as their principal business and by a strange absurdity regard ,

the character of the sovereign a but an appendix to that f s o

the merchant as something which ought to be made subservient

,

to it or by means of which they may be enabled to buy cheaper

,
1
34 Th e W e al t h of N at i o n s
in India and thereby to sell with a better profit in Europe
, .

They endeavour for this purpose to keep o u t as much as possible

all competitors from the market o f the countries which are
subj ect to their government and consequently t reduce at ,
o ,

least some part of the surplus produce o f those countries to

,

wh at is barely sufficient fo supplyin g their own demand tor ,

or

what they can expect to sell i Europe with such a profit as they n

may think reasonable Their mercantile habits draw them in

.

this manner almost necessarily though perhaps insensibly to

, , ,

prefer upon all ordinary occasions the little and transitory profit
of the monopolist to the great and permanent revenue o f the
sovereign and would gradually lead them to treat the countries
,

subj ect to their gover ment nearly as the Dutch treat the
n

Moluc as It is the interest f the East India Company con

c . o ,

sid e ed a s sovereigns that the European goods which are carried

r
,

to their Indian dominions should be sold there as cheap as

possible ; and that the Indian goods which are brought from
thence should bring there as good a price sh ould be sold ,
or

there as clear as possible But the reverse o f this is their interest

.

as merchants As sovereigns their interest is exactly the same

.
,

with that f the country which they govern A merchants

o . s

their interest is directly opposite to that interest .

But if the genius o f su c h a government even as to what ,

concerns its direction in Europe is in this manner essentially ,

and perhaps incurably faulty that o f its administration in India ,

is still more 5 0 That admin i stration is necessarily composed of

.

a council of merchants a profession no doubt extremely respect

,

able but which in no country in the world carries along with it

,

that sort o f authority which naturally overawes the people ,

and without force commands their willing obedience Such a .

council can command obedie nce only by t he milita y force with r

which they are accompanied and their government is therefore ,

necessarily military and despotical Their proper business .

,

however is that f merchants It is to sell upon their ma ters

,
o .
,
s
’

account the European goods consigned to them and to buy

, ,

in return Indian goods fo the European market It is to sell r .

the o e as dear and t o buy the other as cheap as possible and

n ,

consequently to exclude as much as possible all rivals from the

particular market where they keep their shop The genius o f the .

administration therefore so far as concerns the trade o f the,

company is the same as that of the direction It tends t o make

,
.

government subservient to the interest o f monopoly and c o n ,

s equently t o stunt the natural growth o f some parts at least o f

 C o l o n i es 1 35
the surplus produce o f the country to what 1 barely sufficient 5

for answering the demand of the co mpany .

All the members o f the administration besides trade more , ,

or less upon their o w account and it is in vain to prohibit

n ,

them from doing 5 0 N othing can be more completely foo lish

.

than to expect that the clerks o f a great counting house at ten -

thousand miles distance and consequently almost quite out o f

,

sight should upon a simple order from their masters give up

, , ,

at once doing any sort f business upon their own account

o ,

abandon f ever all hopes of making a fortune o f which they

or

have the means in their hands and content t he riel e with the
,

r s v s
,

moderate salaries which those masters allow them and which ,

moderate as they are can seldom be augmented b eii

,

, g commonly ,
r

as large as the real profits o f the company trade can aff ord In .

such circumstances to prohibit the servants o f the company

,

from trading upon their w accoun t can have scarce any other
o n

e ffect than to enable the superior servants under pretence o f ,

executing their masters order to Oppress such o f the inferior

’
,

ones as have had the misfortune to fall under their displeasure .

The servants naturally endeavour to establish the same monopoly

in favour of their o w private trade as o f the public trade o f
n

the company If they are suff ered to act as they could wish
.
,

they will establish this monopoly openly and directly by fairly ,

prohibiting all other people from trading the articles I which In n

they choose to deal ; and this perhaps is the best and least , ,

oppressive w ay of establishing it But if by an order from .

Europe they are prohibited from doing this they will o t wit h , ,
n

standing endeavour to estab lish a monopoly of the same kind

, ,

secretly and indirectly i a w ay that much more d estructive

,
n Is

to the country They will employ the whole authority o f govern

.

ment and pe rvert the admi nistration o f justice in order t o

, ,

harass and rui n those wh interfere with them in any bran h o f

o c

commerce which by means of agents either concealed o at

, , ,
r

least not pub licly avowed they may choose to carry o

,
But n .

the private trade o f the servants will naturally extend t o a

much greater variety of articles than the pub lic trade of the
company The public trade of the company extends no further
.

than the trade with Europe and comprehends a part only o f the
,

forei gn trade o f the ountry But the private trade o f t he

c .

servants may extend to all the different branches both o f it s

inland and foreign trade The monopoly f the co mpany c an
. o

tend only to stunt the natural growth f that part of the surplus o

produce which in the case of a free trade would be exp o rt ed

, ,
'
I
36 Th e W e al t h of N a t i o n s
to Europe That o f the servants tends t o stunt the natural
.

growth o f every part o f the produce in which they choose to

deal of what is destined fo r home consumption as well as o f
, ,

what is destined for exportation ; and consequently to degrade

the cultivation of the whole country and to reduce the number ,

o f its i n habitants It tends to reduce the quantity o f every

.

sort of produce even that o f the necessaries o f life whenever

, ,

the servants o f the company choose to deal in them to what ,

those servants can both afford to buy and expect to sell with
such a profit as pleases them .

From the nature f their situation too the servants must be

o , ,

more disposed to support with rigorous severity their w n o

interest against that o f the country which they govern than

their masters can be to support theirs The country belongs .

to their masters w ho cannot avoid having some regard for the

,

interest o f what belongs to them But it does not belong to the .

servants The real interest of their masters if they were capable

.
,

o f understanding it is the same wi th that o f the country and

,
1
,

it is from ignorance chiefly and the meanness f mercantile ,

o

prej udice that they ever Oppress it But the real interest o f
, .

the servants is by no means the same with that o f the country ,

and the most perfect information would not necessarily put an

end to their Oppressions The regulations accordingly which .

have been sent out from Europe though they have been ,

frequently weak have upon most occasions been well meaning

,
-

More intel ligence and perhaps less good mean ing has sometimes -

appeared in those established by the servants in India It is .

a very singular government in which every member o f the

admi nistration wishes t o get out of the country and consequently ,

to have done with the government as soon as he a and to c n,

whose interest the day after he has left it and carried his whole
,

fortune with him it is perfectly indi ff erent though the whole

,

count y w a swallowed up by an earthquake

r s .

I mean not however by anything which I have here said to

, , ,

throw any odious imputation upon the general chara ter o f the c

se vants o f the East India Company and much less upon that
r ,

of any particular persons It is the system o f government the .

,

situation in whic h they are placed that I mean to censure not , ,

the character f those who have acted in it They acted as

o .

their situation naturally dire ted and they who have clamoured c ,

1
Th i t e t f v y p p i t
n er es f I di t k h w v
o e er i by ro r e or o n a s oc o e er , s no
m w it h t h t f t h t y i th g v m t f w h i h hi
,

m ean sth e sa e a o e c o un r n e o ern en o c s

v t giv h im m i fl
o e es so S b k v h p i p t ii i
e n uen c e . ee oo . c a . . ar .
 C o n c l u s i o n of t he M er c an t il e S y s t e m 1
37
the loudest against them would probably not have acted better
themselves In war and negotiation the councils of Madras
.
,

and Cal c utta have upon several occasions conducted themselves

with a resolution and decisive wisdom which would have done
honour to the senate o f Rome in the best days of that republi c .

The members o f those councils however had been bred to , ,

professions very d ifferent from war and politics But their .

situation alone without education experien e or even example

, ,
c , ,

seem s to have formed in them all at once the great qualities

which it required and t o have inspire d them both with abilities
,

and virtues which they themselves could not well know that
they possessed If upon some oc asions therefore it has
. c , ,

animated them to actions f magnanimity which could not well o

have b een expected from them we should not wonder if upon ,

others it has prompted them to exploits of somewhat a different

nature .

Such exclusive compan ies therefore are nuisances in every , ,

respect ; always more o less inconvenient to the countries in

r

which they are established and destructive to those which have ,

the misfortune to fall under their government .

CHAPTER VIII
CO N LU N
C SI O OF THE M E RC ANT L I E S YT M
S E

T HOU GH the encouragement o f exportation and the discourage

m ent o f i mportation are the two great engines by whi h the c

mercantil e system proposes to en i h every country yet with r c ,

regard to some particular commodities it seems t o follow an

Opposite plan to discourage expor t ation and to encourage im
:

p r
o t a t i
o Its ultimate
n . obje t however it pretends is always c , , ,

the same to enrich the country by an advantageous balanc e of

,

trade It discourages the exporta tion of the materials of manu

.

facture and f the inst um ents o f trade in order to give our

,
o r ,

ow n workmen an advantage and to enable them to undersell ,

those of other nations in all foreign markets ; and by restraining ,

in this manner the exportation f a few ommodities f no

,
o c ,
o

great price it proposes to o c casion a mu h greater and more

,
c

valuable exporta tion o f others It encourages the importation .

o f the materials f manufacture i n order that o u

o own people r

may b e enabled to work them up more cheaply and thereby ,

 The W eal t h of N at i o n s
prevent a greater and more valuable importation o f the manu
f c t u red commodities
a I do not observe at least in our Statute
.
,

Book any encouragement given to the importation o f the

,

instruments o f trade When manufactures have advan ed to a. c

certain pitch of greatness the fabrication of the instruments o f ,

trade becomes itself the object o f a great number f very im o

port ant manufactures T give any particular encouragement . o

to the importation of such instruments would interfere too

much with the interest of those manufactures Su c h importa .

tion therefore instead of being encouraged has frequently been

, , ,

prohibited Thus the importation o f wool ards except from

. c ,

Ireland o when brought in as wreck or prize goods was

,
r ,

prohibited by the 3rd o f Edward IV which prohibition was .

renewed by the 39t h of Elizabeth and has been continued ,

and rendered perpetual by subsequent laws .

The importation of the materials of manufacture has some

times been encouraged by an exemption from the duties t o
which other goods are subje t and sometimes by bounties c ,
.

The importation of sheep s wool from several different ’

countries of cotton wool from all countries of undressed flax

, , ,

of the greater part f dying drugs o f the greater part of un

o ,

dressed hides from Ireland o the British colonies of sealskins r ,

from the British Greenland fishery of pig and bar iron from ,

the British colonies as well as of several other materials of

,

manufacture has been encouraged by an exemption from all

,

duties if properl y entered at the custom house The private

,
.

interest of our merchants and manufacturers may perhaps , ,

have extorted from the legislature these exemptions as well as

the greater part o f ur other commercial reg ulations They o .

are however perfectly just and reasonable and if consistently

, , , ,

with the necessities of the state they could be extended to all ,

the other materials of manufacture the public would certainly ,

be a gainer .

The avidity of our great manufacturers however has in some , ,

cases extended these exemptions a good deal beyond what can

j ustly be considered as the rude materials of their work By .
’

the 4 Geo II chap 4 6 a small duty of only o e penny the

2 . . .
,
n

pound was imposed upon the importation o f foreign brown linen

yarn instead o f much higher duties to whi h it had been sub
,
c

j e c t ed before viz o f S ixpence the pound

,
upon sail
. yarn o f one ,

shilling the pound upon all French and Dutch yarn and of t wo ,

pounds thirteen shillings and fourpence upon the hundredweight

of all spruce or Musc o v ia yarn But o u manufacturers were . r
 C o n c l u s i o n of t h e M er c an t il e S y s t e m 1
39
not long satisfied with this r eduction By the 9t h o f the same . 2

king chap 5 the same law which gave a bounty upon the
,
. 1 ,

exportat on o f British and Irish linen o f which the pri c e did o t

i n

exceed eight ee p e c e the yard even this small duty upon the
n n ,

importation o f brown lin en yarn was taken away In the .

di fl e t Operations ho w ever whih are necessary for the pre

er n , ,
c

p arat i o f linen
on yarn a good deal more in dustry is employed ,

than in the subsequent Operation of prepar in g lin en cloth from

lin en yarn To say nothing of the indus t ry o f the fl ax growers
.
-

an d fl x dressers three or four spinners at least are necessary

a -

, , ,

in order to keep o e weaver in c onstant employm ent ; and more

n

tha n four fift hs o f the whole quantity o f labour ne essary for the
-

preparation o f li en cloth is employed in that o f linen yarn ;

n

but o u spinners are poor people women commonly sca ttered

r ,

about in all d ifl e e t parts f the count y without support or

r n o r ,

protection It is not by the sale of their work but by that o f

.
,

the complete work o f the weavers that o u great master manu ,

r

f c t u e s make their profits

a r r As it is their in terest to sell the .

complete manufacture as dear so is it to buy the materials as ,

cheap as possible By extorting from the legislature bounties

.

upon the exporta tion f their o w lin en high duties upon the o n ,

importation o f all foreign linen and a total prohibition o f the ,

home ons umption o f some sorts o f French linen they endeavour

c ,

t o se ll their o w goods as clear as possible n By en ouraging the . c

importa tion o f foreign li en yarn and thereby bringing it into n ,

competition with that which made by o ur own people they 15 ,

endea vour t buy the work o f the poor spinn ers as cheap as
o

possible They are as intent to keep down the wages of their

.

ow weavers as the earnin gs o f the poor spin ners and it is by

n ,

no mean s for the benefit o f the work man that they endeavour
either to raise t h price o f the complete work or to lower th at
e

o f the rude materials It is the industry whi h is arried on for. c c

the benefit o f the rich and the powerful that is princip ally
en ouraged by o ur mer antile system That which is carried
c c .

o nfor the benefit o f the poor and the in digent is too ofte n
either neglected o Oppressed r .

Both the bounty upon the exporta tion of linen and the ,

exemption from duty upon the importation o f foreign yarn ,

which were granted o nly for fifteen years but ontinued by t wo ,

c

different prolongations expir e with the end f the session o f ,

o

parliament which shall immediately follow the 4t h of June 2

1 786 .

Th e encouragement given t o the importation of the materials

1
4 0 T he W eal t h of N a t i o n s
o fmanufacture by bounties has been principally c fined to on
-

s uch as were imported from our A merican plantations .

The first bounties of this kind were those granted about the
b eginning o f the present c entury upon the importation of naval
s tores from Ameri a Under this denomination were compre c .

h ended timber fit for m asts yards and bowsprits hemp ; tar , , ,

pitch and turpentine The bounty however of one pound the

,
.
, ,

t onupon masting timber and that of six pounds the ton upon -

hemp were extended to su h as should be imported into Eng

,
c

land from S otland Both these bounties continued without

c .

any variation at the same rate till they were severally allowed
, ,

t o expire ; that upon hemp on the s t o f January 74 and I 1 1,

t hat upon masting ti mber at the end of the session of parlia -

m ent immediately following the 4 t h June 78 2 1 1 .

The bounties upon the importation f tar pit h and tur o ,

c ,

p entine underwent during their c ontinuance several altera , ,

t ions O riginally that upon tar was four pounds the ton ; that
.

u pon pit h the same ; and that upon turpentine three pounds
c ,

t he ton The bounty of four pounds the ton upon tar was
.

a fte rwards onfined to su c h as had been prepared in a parti

c

c ula manner ; that upon other good clean and mer hantable
r , ,
c

t a was reduced to two pounds four shillings the ton

r The .

b ounty upon pitch was likewise reduced to one pound ; and

t hat upon turpentine to one pound ten shillings the ton .

The second bounty upon the importation of any o f the

m aterials f manufa ture according to the order of time was
o c , ,

t hat granted by the Geo II hap 30 upon the importation 21 . . c .

,

o f indigo from the British plantations When the plantation .

i ndigo was worth three fourths of the pri e of the best Fren h -
c c

i ndigo it w by this act entitled to a bounty of S ixpence the

,
as

pound This bounty whi h like most others was granted

.
,
c , ,

o nly for a limited time was continued by several prolongations , ,

b u t was reduced to fourpence the pound It was allo w ed to .

e xpire with the end of the session of parliament which followed

th 5 t
e 2h Mar h 78 c 1 1 .

The third bounty of this kind was that granted (much about
t h time that we were beginning sometimes to ourt and some
e c

t imes to quarrel with our Am eri c an c olonies ) by the 4 Geo .

III chap 6 upon the importation of hemp or undressed flax

. . 2 , , ,

from the British plantations This bounty was granted f . or

t wenty one years from the -

4 t h June 764 to the 4 t h June ,

2 1 2

1 8
7 5 For the
. first seven years it w a to be at the rate of eight s

pounds the ton for the second at six pounds and for the third
, ,
 Co n c l u s i o n of t h e M er c a n t il e S y s t e m 14 1

at four pounds It w as not extended to Scotland o f which t he

.
-

cl imate (although hemp is sometimes raised there in small

quantities and of an inferior qu ality ) is t very fit for that no

produce Such a bounty upon the importa tion of S ot h flax

. c c

into England would have been too great a discourage m ent t o

the native produce f the southern part o f the united kingdom o .

The fourth bounty of this kind was that granted by t he

5 Geo III . hap 45 upon .the importation
c of wood .fro m ,

America It w a granted for nine years from the st January

. s ,
I

1 7 66 to the s t January 7 7 5 rDuring the first three years 1 .

,

it w as t be fo every hundred and twenty good deals at t he

o r ,

rate f o e pound and for every load containing fifty cubic fee t
o n ,

of other squared timber at the rate f twelve shillings F o t he o . r

second three years it was for deals to be at the rate o f fiftee ,

n

shil lings and for other squared timber at the rate f eight
,
o

shillings ; and for the third three years it was for deals to b e ,

at the rate o f ten shillin gs and for other squared timber at t he ,

rate o f five shillings .

The fifth bounty o f this kind was that granted by the 9 Geo
III chap 38 u pon the importation o f raw silk from the British
. .
,

plantations It was granted fo twenty o e years from t he

. r -
n ,

r s t January 770 to the r t January 79

1 F o the first seven s 1 1 . r

years it was to be at the rate o f twenty fi e pounds fo every -

v r

hundred pounds value ; for the second at twenty pounds ; a d n

for the third at fifteen pounds The management o f the silk .

worm and the preparation of silk requires so much hand

, ,

labour and labour is so very dear in America that even thi s

,

great bounty I have been informed was o t likely to produce

, ,
n

any considerable effect .

The sixth bounty o f this k ind was that granted by Geo 2 .

III chap 5 0 for the importation of pipe hogshead and barre l

. .
, , ,

staves and heading from the British plant ations It was grante d .

for ni e years from st January 77 to the t January 78

n ,
r 1 2 rs 1 1 .

For the first three years it was fo a erta in quanti t y of ea h r c c

to be at the rate of six pounds ; for the se ond three years at c

four pounds ; and for the third three years at t wo pounds .

The seventh and last bounty f this kind was that grante d o

by the 9 Geo III chap 37 upon the importa tion of hemp

1 . . .
,

from Ireland It was granted in the same man er as that f

. n or

the importa tion of hemp and undressed flax from Am erica fo ,

r

twenty one years from the 4 t h June 779 to the 4 t h June

-

,
2 1 2

1 8 00 . This term is divided likewise into three periods o f seve , ,

n

years eac h ; and in ea h o f those periods the rate o f the Irish c

14 2 Th e
W eal t h of N at i o n s
bounty is the same with that f the Amer i can It does o . no t ,

however like the American bounty extend to the importation

, ,

o f undressed flax It would have been too great a discourage

.

ment to the cultivation o f that plant in Great B ritain When .

this last bounty was granted the British and Irish legislatures ,

were not in much better humour with one another than the
British and American had been before But this boon to Ireland .
,

it is to be hoped has been granted under more fortunate auspices

,

than all those to America .

The same commodities upon which we thus gave bounties

when imported from America were subjected to considerable
duties when imported from any other country The interest o f .

o u r A mer i can colonies was regarded as the same w i th that of

the mother country Their wealth was considered as o ur wealth
. .

Whatever money was sent o ut to them it wa s said came all back , ,

to us by the balance o f trade and we could never become a ,

farthing the poorer by any expense which we could lay o u t

upon them They were our w i every respect and it was an
. o n n ,

expense laid o u t upon the improvement of our o w property n

and fo the profitable employment o f o ur o w people It is

r n .

unne essar y I apprehend at present to say anything further

c , ,

in order to expose the folly o f a system which fatal experience

has now sufficiently exposed Had u American colonies really . o r

been a part f Great Britain those bounties might have been

o ,

considered as bounties upon production and would still have ,

been liable to all the obj ections to which such bounties are liable ,

but to no other .

The exportation o f the materials o f manufacture is sometimes

dis ouraged by absolute prohibitions and sometimes by high
c ,

duties .

O ur woollen manufacturers have been more successful than

any other class o f w o kin n in persuading the legislature that
r e

the prosperity o f the nation depended upon the success and

extension o f their particular business They have not only .

obtained a monopoly against the onsumers by an absolute c

prohibition o f importing woollen cloths from any foreign country ,

but they have likewise obtained another monopoly against the

S heep farm ers and growers o f wool by a similar prohibition o f

the exportation f live sheep and wool The severity o f many

o .

o f the laws whi c h have been enacted for the security o f the
revenue is ve ry justly complained o f as imposing heavy penalties ,

u pon actions which antecedent to the statutes that declared

,

them to be crimes had always been understood to be innocent

,
.
 Co n c l u s i o n of t h e M er c an t il e S y s t em 14
3
But the cruellest o f o ur revenue l aws I will venture to flirm ,
a ,

are mil d and gentle in comparison o f some o f those which the

clamour o f o u merchants and manufacturers has extorted from
r

the legislatu re fo the support o f their own absurd and Oppressive

r

monopolies Like the laws o f Draco these laws may be said to

.
,

be all written in blood .

By the 8 th o f El izabeth chap 3 the exporter o f sheep lambs ,

.
, , ,

or rams was for the first offen e to forfeit all his goods fo c r

ever to suffer a year s imprisonment and then to have his left

,
’
,

hand cut o ff in a market town upon a market day to be there ,

nailed up ; an d fo r the second off ence to be adjudged a felon ,

an d t o su ffer death accordingly To prevent the bree d f o ur . o

sheep from be ing propagated in foreign countries seems to have

been the object o f this law By the 3th and 4 th o f Charles . 1 1

II hap 8 the exportation o f wool was made felony and the

. c . 1 , ,

exporter subjected to the same penalties and forfeitures as a

felon .

For the honour o f the national humanity it is to be hoped ,

that neither o f these statutes were ever executed The fi t . rs

o f them however so far as I kn ow has never been dire tly

, , ,
c

repealed and Serjeant Hawkins seems t o consider it as still in

,

force It may however perhaps be considered as vir t ually

.
, ,

repe al ed by the t h o f Charles II chap 3 sect 3 which

12 . . 2, .
, ,

without expressly taking away the penalties imposed by former

statutes imposes a new penalty viz that o f twenty shil lings
, ,
.
,

fo every sheep exported or atte mpted to be exported together

r , ,

with the forfeiture of the sheep and o f the ow er s share f the n

’
o

ship The se ond of them was expressly repe aled by the 7t h

. c

and 8t h o f William III chap 8 sect 4 By which it is de lared

. . 2 ,
. . c

that Whereas the sta tute o f the 3th and 4 th o f King Charles
,
1 1

II made agains t the exportation o f wool among other things

.
, ,

in the said act mentioned doth enact the same to be deemed ,

felony ; by the severity o f which penalty the prosecution f o

offenders hath not been so effectu ally put in exe ution Be it c : ,

therefore enacted by the authority foresaid that so mu h o f

, ,
c

the said act which relates to the making the said Offence felony
, ,

be repealed and made void .

”

The penalties however which are either imposed by this

, ,

milder statute which though imposed by former statutes

,
or , ,

are o t repealed by this o e are still uflic ie t ly severe Besides

n n ,
s
‘
n .

the forfeiture o f the goods the exporter incurs the penalty o f ,

three shillings fo r every pound weight o f wool either exported o r

attempted t o be exported that is about four or five times the ,

14 4 Th e W e al t h of N a t i o n s
value Any merchant o other person convicted of this o fl en ce
. r

is disabled from requiring any debt o account belonging to r

hi m from any factor o r other person Let his fortune be what .

it will whether he is o is not able to pay those heavy penalties

,
r
,

the law means to ruin him completely But as the morals of .

the great body f the people are not yet so corrupt as thos e
o

o f the contrivers of this statute I have not heard that any ,

advantage has ever been taken of this clause If the person .

c onvicted o f this o ffence is not able to pay the penalties within

three m onths after judgment he is t o be transported for seven ,

years and if he returns before the expiration of that term he

, ,

is liable to the pains of felony without benefit of clergy The ,

.

owner o f the ship knowing this offence forfeits all his interest
, ,

in the ship and furniture The master and mariners knowing

.
,

this o ffen e forfeit all their goods and hattels and suffer thre e
c ,
c ,

months imprisonment By a subsequent statute the maste r

’
.

su ff ers six months imprisonment ’

.

In order to prevent exportation the who l e inland commerce ,

o f wool is laid under very burdensome and oppressive restrictions .

It cannot be pa ked in any box barrel cask case hest or a y

c , , , ,
c ,
n

other package but only i packs o f leather o pack cloth on

,
n r -

which must be marked on the outside the words w l or y n oo ar ,

in large letters o t less than three inches long o n pa in o f fo r

n ,

feiting the same and the pa kage and three shillings for every c ,

pound weight to be paid by the owner or packer It ca nnot

,
.

be loaden o any horse o cart or c arried by land within five

n r ,

miles of the coast but between sun rising and sun setting o
,
- -

,
n

pain f forfeiting the same the horses and carriages The

o ,
.

hundred next adjoining to the sea coast o ut of or through -

which the wool is carried or exported forfeits twenty pounds , ,

if the wool is under the value of ten pounds ; and if of greater

value then treble that value together with treble osts to be
, ,
c ,

sued for within the year The execution to be against any two
.

of the inhabitants whom the sessions must reimburse by an

, ,

assessment o the other inhabitants as in the cases of robbery

n ,
.

And if any person compounds with the hundred for less than
this penalty he is to be imprisoned for five years ; and any
,

other person may prosecute These regulations take place .

through the whole kingdom .

But in the parti c ular counties of Kent and Sussex the ,

restrictions are still more troublesome Every owner o f wool .

within ten miles of the sea coast must give an account in -

writing three days after shearing to the next o fficer o f the

, ,
 C o n c l u s i o n of t he M e r c an t il e S y s t e m 145

c ustoms o f the number of his fl eec es and of the pla es where

, ,
—
c

t hey are lodged And before he removes any part of them he

.

must give the like notice f the number and weight of the o

fl eeces and of the name and abode of the person to whom they
,

a e sold and o f the place to whi h it is intended they should

r ,
c

b e carried N o person within fifteen miles o f the sea in the

.
,

s aid counties ca buy any wool before he enters into bond to

,
n

the king tha t no part of the wool whi h he shall so buy shall c

be sold by him to any other person within fifteen miles of the

s ea If any wool is found carrying towards the sea side in the
.
-

said counties unless it has been entered and security given as

,

aforesaid it is forfeited and the off ender also forfeits three

, ,

s hillings fo every pound weight If any person lays any wool

r .

not entered as aforesaid within fifteen miles o f the sea it must ,

be seized and forfeited ; and if after such seizure any person , ,

claim the same he must give security to the Exchequer that if

,

he is cast upon trial he shall pay treble costs besides all other ,

penalties .

When such restrictions are imposed upon the inland trade ,

the coasting trade we may believe annot be left very free , ,

c .

Every owner o f wool w ho carrieth or auseth to be carried any c

wool to any port or place on the sea oast in order to be from -

c ,

thence transported by sea to any other place o port o n the r

coast must first cause an entry thereof to be made at the port

,

from when e it is intended to be onveyed ontaining the

c c ,
c

weight marks and number o f the packages before he brings

, , ,

the same within five miles of that port on pain of forfeit ing ,

the same and also the horses carts and other carriages ; and
, , ,

also o f su ffering and forfeiting as by the other laws in for e c

against the exportation f wool This law however ( Will o .

,
1 .

III hap . c is so very indulgent as to de lare that this

. c ,

shall not hinder any person from arrying his wool home from c

the place o f shearing though it be within five miles f the sea ,

o ,

provided that in ten days after shearing and before he remove ,

he do under his hand certify to the next o fficer of the

the true number o f fleeces and where it is housed ; ,

0 not remove the same without certifying to such o fli c er , ,

s hand his intention so to do three days before ”

hi , , .

must be given that the wool to be carried coast ways is -

landed at the particular port for which it is entered out

and if any part f it is landed without the presence of o
 Th e W eal t h of N at i o n s
other goods but the usual additional penalty of three shillings
,

fo r eve ry pound weight is likewise incurred .

O ur woollen manufacturers in order to jus t ify their d emand ,

o f such extraordinary restrictions and regulations confidently ,

asserted that English wool w a o f a peculiar quality superior s ,

to that o f any other country ; that the wool o f other countries

could o t without some mixture o f it be wrought up into any
n , ,

tolerable manufa ture ; that fine cloth cou l d n o t be made with

c

out it ; that England therefore if the exportation o f it could

, ,

be totally prevented could monopolise to herself almost the

,

whole woollen trade o f the world ; and thus having no rival s , ,

could sell at what price she pleased and in a short time acquire ,

the most in redible degree o f wealth by the most advantageous

c

balance of trade This doct rine l ike most other doctrines

.
,

which are confidently asserted by any considerable number of

people w as and still continues to be most implicitly believed
by a much greater number—b y almost all those who are either
, , ,

unacquainted with the woollen trade o r who have not made ,

particular inquiries It is however so perfectly false that

.
, ,

English wool is in any respect necessary for the making of fine

cloth that it is altogether unfit for it Fine cloth is made .

altogether o f Spanish wool English wool cannot be even so .

mixed with Spanish wool as to enter into the composition with

o u t spoiling and degrading in some degree the fabric o f t he , ,

cloth .

It has been shown in the forego ing part o f thi s work that the
e ffect o f these regulations has been t o depress the price o f
English wool not only below what it naturally wou l d be in the
,

present times but very much below what it actually w a s in

,

the time o f Edward III The price of Scots wool when in .

,

consequence o f the union it became subject to the same regula

tions is said to have fallen about o e half It is observed by
,
n .

the very accurate and intel l igent author of the Memo is of r

W ol the Reverend Mr John Smith that the price o f the best

o ,
.
,

English wool in England is generally below what wool o f a very

inferior quality commonly sells for in the market of A msterdam .

To depress the price of this commodity below what may be

called its natural and proper price was the avowed purpose of
those regulations ; and there seems to be no doubt o f their
having produced the e ffect that was expected from them .

This reduction of price it may perhaps be thought by dis , ,

c o u ag
r ig the growing of wool must have reduced very much
n ,

the annual produce o f that c ommodity though not belo w what ,

 C o n clus i o n o f t he M e r c a n t il e S y s t e m 14
7
it formerly was yet below what in the present state o f things
, , ,

it probably would have been had it in consequence o f an Open , ,

and free market been allowed to rise to t he natural and proper

,

price I am however disposed to believe that the quantity

.
, ,

of the a nnual produce ca n ot have been much though it may n ,

perhaps have been a little affected by these regulations The ,

.

growing o f wool is not the hief purpose for which the sheep c

farmer employs hi industry and stock He expects his profit

s .

n o t so much from the price o f the fleece as from that o f the

ca rcase ; and the average o ordinary price o f the latter must r

even in many cases make up to him whatever deficiency there

, ,

may be i the average o ordinary price o f the fo mer It has

n r r .

been observed in the foregoing part of this work that What

ever regulations tend t o sink the pri e either of wool o r o f raw c ,

hides below what it nat urally would be must in an improved

, , ,

and cultivated country have some tendency to raise the pric e

,

of butcher s meat The price both o f the great and smal l

’
.

cattle which are fed o improved and cultivated land must b e

n

sufli cien t to pay the rent which the landlord and the profit ,

which the farmer has re ason to expect from improved and

cu ltivated land If it is not they will soon cease to feed them
.
,
.

What ever part o f this price therefore is o t paid by the woo l , ,

n

and the hide must be paid by the carcase The less there is .

pa id fo the o e the more must be paid fo the other In what

r n ,
r .

manner this price is to be divided upon the d ifferent parts o f

the beas t is in d ifie e t to the landlords an d farmers provided it
r n ,

is all paid to them In an improved and cultivated country

.
,

therefore their interest as landlords and farmers ca nnot be

,

much affected by such regulations though their in terest as ,

consume s may by the rise in the price of provisions Accord

r .
”

ing t o this reasoning t herefore this degradation in the price

, ,

o f wool is not li kely in an improved and cultivated country t o

, ,

o ccasion any diminution in the annual produce of that com

mo d it y except so far as by raising the price of mutton it may

, , ,

somewhat diminish the demand fo and cons equently the p ro r,

duct ion o f that particular species o f butcher s meat Its e ffect

,
’
.
,

however even in this way it is probable is not very cons iderable

But t li
, , ,
.

o u h its e ffect upon the quantity f the annual produc

g e o

may not have been ve ry considerable its efl ec t upon the quality , ,

it may perhaps be thought must necessarily have been very ,

great The degradation i the quality o f English wool if n o t

. n ,

below what it was in former times yet below what it naturally ,

would have been in the present sta te o f improvement and culti

 1 4 8 T he W e al t h of N a t i o n s
vation must have be en it may perhaps be supposed very nearly
, , ,

in proportion to the degradation of price As the quality .

depends upon the breed upon the pasture and upon the , ,

management and cleanliness of the sheep during the whole ,

progress o f the growth f the fleece the attention to these cir

o ,

c um t a c e
s it may naturally enough be imagined can never be
n s, ,

greater than in proportion to the recompense which the price of

the fleece is likely to make for the labour and expense which
that attention requires It happens however that the good .
, ,

ness of the fleece depends in a great measure upon the health , , ,

growth and bulk o f the animal ; the same attention which

,

is necessary for the improvement of the carcase is in some ,

respects su fficient for that of the fleece N otwithstanding the

,
.

degradation of price English wool is said to have been improved

,

considerably during the course even of the present century .

The improvement might perhaps have been greater if the price

had been better ; but the lowness o f price though it may have ,

o bstructed yet certainly it has not altogether prevented that

,

improvement .

The violence of these regulations therefore seems to have , ,

affected neither the quantity nor the quality of the annual

produce f wool so much as it might have been expected to do
o

( though I think it probable that it may have a ffected the latter

a good deal more than the former ) ; and the interest o f the
growers o f wool though it must have been hurt in some degree
, ,

seems upon the whole to have been much less hurt than could
, ,

well have been imagined .

These considerations however will o t j ustify the absolute

, ,
n

p rohibition of the exportation of wool But they will fully .

j ustify the imposition of a cons iderable tax upon that exportation .

To hurt in any degree the interest of any one order of citizens ,

for no other purpose but to promote that of some other is ,

e vidently contrary to that j ustice and equality f treatment o

which the sovereign owes to all the di fferent orders of his sub
j e c t sBut. the prohibition certainly hurts in some degree the , ,

interest of the growers of wool for no other purpose but to ,

p romote that o f the manufacturers .

Eve ry different order o f citizens is bound to contribute to

the support of the sovereign or commonwealth A tax of five .
,

o r eve of ten shillings upon the exportation o f every ton of

n

wool would produce a very considerable revenue to the sove

r eign I t would hurt the interest of the growers somewhat less
.

than the prohibition because it would o t probably lower the

,
n
 C o n c l u s i o n of t h e M er c an t il e S y s t em 149

price o f wool quite so much It would afford a sufficient d . a

vantage to the manufacturer because though he might t buy , ,

no

his wool altogether so cheap as under the prohibition he would ,

still buy it at least five or ten shillings cheaper than any foreign
, ,

manufacturer could buy it besides savi g the freight and ,

n

insurance which the other would be obliged to pay It is

,
.

scarce pos ible to devise a tax which could produce any con
s

s id e a b le revenue to the sovereign and at the same time occasion

r ,

so little inconveniency to anybody .

The prohibition notwithstanding all the penalties which guard

,

it does t prevent the exportation of wool It is exported it

,
no .
,

is well known in great quantities The great difference between

,
.

the price in the home and that in the foreign market presents
such a temptation to smuggling that ll the rigour o f the l w a a

ca not prevent it This illegal exportation is advantageous t o

n .

nobody but the smuggler A legal exportation subject t o a tax .

,

by aff ording a revenue to the soverei gn and thereby saving the ,

imposition f some other perhaps more burdensome d i

o , ,
an n

convenient taxes might prove advantageous t o all the d ifie e t r n

subjects o f the state .

The exporta tion o f fuller s eart h o fuller s clay supposed to ’

r
’
,

be necessary f preparing and cleansin g the woollen m ufa

or an c

tures has been subjected to nearly the same penalties as the

,

exportation f wool Even tobac c o pipe clay though acknow

o .
-

ledged to be different from fuller s lay yet o a ccount o f ’

c , ,
n

their resemblance and because fuller s c lay might sometimes

,
’

be exported as tobacco pipe clay has been laid under t he -

same prohibitions and penalties .

By the 3t h and i4 t h o f Charles II chap 7 the exportation

1 . .
, ,

not only o f raw hides but o f tanned leather except in the shap e , ,

o f boots shoes o r slippers w a s prohibited ; and the law gave a

, , ,

monopoly to o ur bootmakers an d shoemakers o t only again s t ,

n

o ur graziers but again st u tanners

,
By subsequent sta tute o r . s

o u r tan ers have got themselves exempted from this monopol

n
y
upon paying a small tax o f only e shilling o the hundred on n

weight of tanned leather weighing hundred and twelve ,

one

pounds They have obtained likewise the drawback o f t w o

.

thirds of the excise duties imposed upon their commodity even

when exported without further manufacture All manufacture . s

o f leather may be exported duty free ; and the exporter is

besides entitled to the drawback o f the whole duties f excise o .

O ur graziers still continue subject to the old monopoly Graziers .

separated from o e another and dispersed through all t he

n ,
1
5 0 Th e W eal t h of N a t i o n s
different corners o f the country cannot without great difficulty , , ,

combine together for the purpose either of imposing monopolies

upon their fellow citizens r of exempting themselves from such
-

,
o

as may have been imposed upon them by other people Manu .

fac t u e s of all kinds collected together in numerous bodies in

r r ,

all great cities easily can Even the horns f cattle are pro
,
. o

hi bi t ed to be exported ; and the two insignificant trades f the o

horner and combmaker enj oy in this respect a monopoly , ,

against the graziers .

Restraints either by prohibitions o r by taxes upon the

, ,

exportation o f goods which are partially but t completely ,

no

manufactured are not peculiar to the manufacture of leather

, .

As long as anything remains to be done in order to fit any ,

commodity for immediate use and consumption o ur man u fa c ,

t u r ers think that they themselves ought to have the doing o f it .

Woollen yarn and worsted are prohibited to be exported under

the same penalties as wool Even white cloths are subj ect to a .

duty upon exportation and o ur dyers have so far obtained a ,

monopoly against o ur Clothiers Ou Clothiers would probably . r

have been able t o defend themselves against it but it happens ,

that the greater part o f o u r principal Clothiers are themselves

likewise dyers Watch cases clock cases and dial plates for
.
-

,
-

,
-

clocks and watches have been prohibited to be exported O ur .

clock makers and watch makers are it seems unwilling that

- -

, ,

the price o f this sort of workmanship should be raised upon

them by the competition o f foreigners .

By some o ld statutes o f Edward III Henry VIII and .

,
.
,

Edward VI the exportation f all metals wa s prohibited L ead

.
,
o .

and tin were alone excepted probably o n account o f the great

abundance o f those metals i the exportation o f wh i ch a c o ,
n n

si d e b le part o f the trade o f the kingdom in those days c o n

ra

s i sted For the encouragement f the mining trade the 5 th o f

. o ,
'

William and Mary chap 7 exempted from the prohibition ,

. 1 ,

i ron copper and mundic metal made from British o e The

, ,
r .

exportation o f all sorts of copper bars foreign as well as British ,

w s afterwards permitted by the 9 t h and

a t h o f William III ro .

chap 6 The exportation o f unmanufactured brass o f what

. 2 .
,

is called gun metal bell metal and shro ff metal still cont i nues
-

,
-

,
-

to be prohib i ted Brass manufactures o f all sorts may

.

exported duty free .

The exportation o f the materials of manufacture where ,

is not altogether prohibited is in many ca ses subjected ,

considerable duties .
 C o n c l u s i o n of t h e M er c an t il e S y s t e m 1
5 1

By the 8 th George I chap 5 t he expo rtation of all goods . . 1 , ,

the produce or manufacture o f Great Britain upon which any ,

duties had been imposed by former statutes w a s rendered duty ,

free The followin g goods however were excepted alum

.
, ,
.
,

lead lead o e tin tanned leather copperas coals wool ca rds

r

white woollen cloths lapis calamin

, , , , , , ,

aris skins o f all sort s glue

, , , ,

c oney hair or wool hares wool hair o f all sorts horses and ’
, , , ,

litharge o f lead If yo u except horses all these are either

.
,

materials o f manufacture o r incomplete manufactures (which ,

may be considered as materials fo still further manufacture ) o r r

,

inst r uments o f trade This statute leaves them subj ect to all .

the old duties which had ever been imposed upon them the o ld ,

s ubsidy and one per cent outwards . .

By t h same sta tute a great number o f foreign drugs fo r

e

dyers use are exempted from all duties upon importation

’
.

E ach of them however is afterwards subjected to a certain

, ,

duty n o t indeed a very heavy o e upon exportation O ur n

dyers it seems while they thought i

, , .

,
t fo their in terest to e
,
r n

courage the importation o f those drugs by an exemption from ,

a ll dut ies thought it likewis e fo r their interest to throw some

,

small discouragement upon their exportation The avidity .

,

however which suggested this notable piece of mercantil e in

,

g n
e u i
t y most probably
,
disappointed itself o f i
t s object It .

necessarily taught the importers to be more careful than they

might otherwise have been tha t their importation should o t n

exceed what w as necessary fo r the supply o f the home market .

The home market w as at all times likely t o be more scantily

supplied ; the commodities were at all times likely t o be some
what dearer there than they would have been had the exporta
tion been rendered as free as the importa tion .

By the above mentioned statute gum senega o gum arabic

-

be ing among the enumerat ed dyiri

, , ,

g drugs might be impo rted ,

du t y free They were subjected indeed to a small poundage

.
, ,

du t y amounting only t o threepen e i the hundredweight upon

,
c n

their re exportation France enjoyed at that time an exclusive

-
.
, ,

trade t o the country most productive o f those drugs that which ,

lies in the neighbourhood o f the Senegal ; and the Britis h market

could o t easily be supplied by the i
n mmwi a t e importation o f

them from the place o f growt h By the 5 t h George II there . 2 .

fore gum senega w as allowed to be imported (contrary to the

,

general d ispositions of the act o f navigation) from any part o f

Europe As the law however did n o t mean t o encourage this
.
, ,

species o f trade so contrary to the general principles of the

,
 1
5 2 T he W e al t h of N at i o n s
merc antile policy o f England it imposed a duty f ten shilli gs , o n

the hundredweight upon such importation and no part of this ,

duty w to be afterwards drawn back upon its exportation

as .

The successful w which began in 755 gave Great Britai ar 1 n

the same exc lusive trade to those countries which Fran e had c

enjoyed before O ur manufacturers as soon as the peace w s

.
, a

made endeavoured to avail themselves o f this advantage a d

, ,
n

to establish a monopoly in their o w favour both against the n

growers and against the importers f this commodity By t he o .

5 th George III therefore chap 37 the exportation o f gum

.
, ,
.
,

senega from his Majesty s dominions in Afri a was confined t ’

c o

Great Britain and was subjected to all the same restrictions

, ,

regulations forfeitures and penalties as that o f the enumerated

, ,

commodities o f the British colonies in America and the West

Indies Its importation indeed w a s subjected to a small duty
.
, ,

o f ixpen e the hundredweight but its e exportation was sub

S c ,
r -

j ec t ed t o the enormous duty of o pound ten shillings t h e ne

hundredweight It w s the intention o f o ur manufacturers that

. a

the whole produce o f those countries should be imported into

Great Britain and in order that they themselves might be
, ,

enabled to buy it at their w price that no part o f it should o n ,

be exported again but at such an expense as would su fficiently

discourage that exportation Their avidity however upo .
, ,
n

this as well as upon many other occasions disappointed itsel f

, ,

o f its object This enormous duty presented such a temptation

.

to smuggling that great quantities of this commodity were

c landestinely exported probably to all the manufacturing ,

countries o f Europe but particularly to Holland not only from , ,

Great Britain but from A frica Upon this account by the 1 4 .

,

George III chap this du ty upon exportation was reduced

. . I O,

to five shillings the hundredweight .

In the book o f rates a cording to which the o ld subsidy was ,

c

levied beaver skins were estimated at six shillings and eight

,

pence piece and the different subsidies and imposts which

a , ,

before the year 7 had been laid upon their importation 1 22 ,

amounted to ne fift h part o f the rate o r t o six t e p c e upon

o -

,
en en

each skin ; all o f which except half the ol d subsidy amounting , ,

only to twopence w as drawn back upon exportation This duty ,

.

upon the importation o f so important a material o f manufacture

had been thought too high and in the year 7 the rate was ,
1 22

reduced to two shillings and sixpence which reduced the duty ,

upon importation to sixpence and f this only o e half was to ,

o n

be drawn back upon exportation The same successful war put .

 C o n c l u s i o n of t he M er c an t il e S y s t em 1 53
t he country most productiv e o f beav er under the dominion o f
Great Brita i n and beaver skins be ing among the enumerated
,

c ommodities their exportation from Ameri c a was consequently

,

c onfined to the market o f Great Britain O ur manufacturers .

s oon bethought themselves o f the advantage w hi c h they might

make o f this ircumstan c e and in the year 764 the duty upon
c ,
1

t he importation o f beaver skin was reduced to one penny but -

t h duty upon exportation was raised to sevenpence each skin

e ,

without any drawback of the duty upon importation By the .

s ame law a duty o f eight p c e the pound w imposed upon

,
een en as

t he exportation o f beaver wool or wombs without mak i ng any -

a lteration in the duty upon the importation of that co mmodity ,

whi h when imported by Britain and in Britis h shipping

c , ,

a mounted at that time to between fourpence and fiv ep e c e the n

p iece .

Coals may be considered both as a material o f manufac t ure

a d as an inst ument of trade
n Heavy duties accord ingly
r .
, ,

have been imposed upon their exportation amounting at present ,

( 7
1 8 3) to more than five shil lings the ton o r to more than ,

fif teen shillings the chaldron N ewcastle me asure which is in , ,

m ost cases more than the original value o f the commodity at

the coal pit or even at the shipping port for export ation
,
.

The exportation however of the instruments of trade , , ,

properly so called is ommonly restrained not by high duties ,

c , ,

but by absolute prohibitions Thus by the 7t h and 8 t h o f .

William III chap 0 sect 8 the exportation of frames o r

. . 2 , ,

engi nes for knitti g gloves or stockings is prohibited under the

n

penalty not only o f the forfeiture of such frames o e gines so

,
r n

e xported r attempted to be exported

,
o but o f forty po unds , ,

o ne half to the k ing the other to the person who S h ll in form ,

‘

o rsue for the same In the same manner by the 4 t h George .

,
1

I I I chap 7 the expor t ation to foreign par ts o f any u t e n sils

. . 1,

made use of in the cotton linen woollen and s il k manufactures , , ,

is prohibited under the penalty not only o f the forfeiture of ,

s uch utensils but of two hundred pounds to be paid by the

, ,

person who shall o ffend in this manner and likewise o f t w o ,

hundred pounds to be paid by the m aster of the ship who shall

1
54 Th e W e al t h of N a t i o n s
or i n any of the manufactures Great Britain to go into ny of ,
a

foreign parts in order to prac tise tea h his trade is liable or c ,

fo r the first o ffence to be fined in any sum not exceeding o ne

hundred pounds and to three months imprisonment and until

,
’
,

the fine shall be paid ; and fo the second o ffen e to be fined r c ,

in any sum at the dis c retion f the court and to imprisonment o ,

f r twelve months and until the fine shall be paid

o ,
By the g d . 2 r

George II hap 3 this penalty is increased for the first offen e

. c . 1 , c

to five hundred pounds for every a t ific so enti ed and t o r er c ,

twelve months imprisonment and until the fine shall be paid ;

’
,

and fo the second offen e to o thousand pounds and to t w o

r c ,
ne ,

years imprisonment and until the fine shall be paid

’
,
.

By the former of those two statutes upon proof that a y , n

person has been enticing any t ific e o that any t ific e h s ar r, r ar r a

promised o ontracted to go into foreign parts for t he purpose

r c s

aforesaid such a t ific e may be obliged to give security at t he

,
r r

dis c retion f the court that he shall not g beyond the seas
o o ,

and may be ommitted to prison until he g ive such security

c .

If any a t ifi er has gone beyond the seas and is exercising

r c ,

o r tea hing his trade in any foreign country

c upon warnin g ,

being given to him by any of his Majesty s ministers or consul ’

s

abroad o by one o f his Majesty s secretaries o f state for t he

,
r
’

time being if he does o t within six months after such warn

,
n ,

in g return into this realm

,
and from thenceforth abide a d , n

inh abit c ontinually within the same he is from thenceforth ,

de lared incapable o f takin g any legac y devised to him within

c

this kin gdom o o f being executor o administrator to a y

,
r r n

person o f tak i
,
ng any lands within this kingdom by descent
or ,

device or purchase
,
He likewise forfeits to the king all his
.

lands goods and chattels is declared an alien in every respect

, , ,

and is put o ut of the kin g 5 protection .

It is unnecessary I imagine to observe how contrary such, ,

regulations are t o the boasted liberty o f the subj ect o f which ,

w e aff ect to be so very j ealous ; but which in this case is so , ,

plainly sacrificed to the futile interests f our merchants and o

manufacturers .

The laudable motive o f all these regulations is to extend o u r

o w n manufactures not by their own improvement but by t h e

, ,

depression f those o f all our neighbours and by putting an

o ,

end as much as possible to the troublesome competition o f

, ,

such odious and disagreeable rivals O ur master manufacturers .

think it reasonable that they themselves should have t he

monopoly of the ingenuity o f all their countrymen Though .
 C o n cl usi o n o f t h e M e r c a n t il e S y s t e m 1
55
by restraining in some trad es the number o f apprentices which
, ,

can be employed at time and by imposing the necessity o f

one ,

a long apprenticeship in all trades they endeavour all o f them , , ,

to confine the kn owledge o f their respective e mployments t o a s

small a number as possible ; they are unwilling however tha t , ,

any part o f this small number should go abroad to instruct

foreigners .

Consumption is the sole end and purpose o f all production ;

and the interest o f the producer ought to be attended to only
so far as it may be ne essary for promoting that o f the
c con

sumer The maxim is so perfectly self evident that it woul d

.
-

be absurd to attempt to prove it But in the mercantile system

.

the interest of the consumer is almost consta ntly sacrificed t o

that o f the producer ; and it seems to consider production and ,

not consumption as the ultimate end and object f all indust y

,
o r

and commerce .

In the restraints upon the importa tion o f all foreign com

m di
o es which can come into competition with those o f
ti ur o

ow n growth o manufacture the interest o f the home consume

r , r

is e v idently sacrificed to that f the producer It is altogethe r

o .

fo r the benefit of the latter that the former obliged to p y is a

that enhancement o f price which this monopoly almost alway s

occasions .

It is altogether for the benefit o f the producer that bountie s

are granted upon the exportation f some o f his productions o

The home consumer is obliged to pay fir st the tax which is , ,

necessary for paying the bounty and secondly the still greate , , r

tax which necessar ily arises from the enhan ement f the pric c o e

of the commodity the home market

in .

By the famous treaty f commerce with Portugal the con

o
,

sumer is prevented by high duties from pur hasing o f a neigh c

b o u rig ountry a co mmodity which o u r w

n c l imate does not o n c

produce but is obliged to pur hase it o f a distant country

,
c
,

though it is ackn owledged that the co mmodity f the distan t o

country is of a worse quality than that of the near one The .

home consumer is obliged to submit to this i conveniency in n

order that the producer may i mport into the distant country
some o f his productions upon more advantageous terms than he
would otherwise have been allowed t o do The consumer too .
, ,

is obliged to pay whatever enh ancement in the price o f thos e

very productions this forced expo r tation may occasion in t he
home market .

But in the system of laws whi ch has been es t a bl ishe d fo r t he

 1
5 6 T he W eal t h of N at i o n s
m anagement o f o u r American and West Indian colonies the ,

nterest o f the home

i consumer has been sacrificed to that of the
producer with a more extravagant profusion than i n all o ur
o ther commercial regulations A great empire has been estab
.

li sh ed for the sole purpose o f raising up a nation o f customers

w h o should be obliged to buy from the shops o f our different

p roducers all the goods with which these could supply them .

For the sake f that little enhancement f price which this

o o

m onopoly might afford our producers the home consumers have ,

b een burdened with the whole expense o f mainta ining and de

f ending that empire For this purpose and fo r this purpose
.
,

only in the two last wars more than two hundred millions have
, ,

been spent and a new debt o f more than a hundred and seventy
,

millions has been contracted over and above all that had been
e xpended for the same purpose in former wars The in terest f . o

this debt alone is n o t only greater than the whole extraordinary

p rofit which it ever could be pretended w a made by the s

monopoly o f the colon y trade but than the whole value of that ,

t rade o than the whole value o f the goods which at an average

,
r

have been annually exported t o the colonies .

It cannot be very difficult t o determine who have been the

contrivers o f this whole mercantile system ; not the consumers ,

w e may believe whose interest has been entirely neglected ; but

,

t h e producers whose interest has been so carefully attended to ;

,

a d among this latter class our merchants and manufacturers

n

h ave been by far the principal architects In the mercantile .

regulations which have been taken notice of in this chapter

, ,

t h e interest o f o ur manufacturers has been most peculiarly

a ttended to ; and the interest not so much o f the consumers , ,

a s that o f some other sets o f producers has been sacrificed to it

- -

, .

CHA PTER IX
f“
OF THE AGR U LT URAL Y T M OR
IC TH OS YS T M OF
S S E S, OF E S E S
PO I L T AL
IC N OMY WH CH R PR NT TH P ROD U C
E CO I E ES E E E

OF LAN D TH R TH L R H P R N C PAL S U RC
AS EI E E SO E O T E I I O E
OF T H R V N
E E D W ALTH
E V RY C U NT RY
UE A N E OF E E O

THEagricultural systems of political economy will not require

s o long an explanation as that which I have thought it necessary
to bestow upon the mercantile or commercial system .

That system which represents the produce of land as the sole

 Th e A g r i c u l t u r al S y s t em s 1
57
source of the revenue and wealth o f é ery country has so far
'

v ,

as I know never been adopted by any nation and it at present

, ,

exists only in the spe ulations o f a few men o f great learning c

and i genuity in France It would o t surely be worth while

n . n , ,

to exam ine at great length the errors o f a system whi h never c

has done and probably never will do any harm in any part of
, ,

the world I shall endeavour to exp lain however as distin ctly

.
, ,

as I can the great outlin es o f this very ingenious system

,
.

Mr Colbert the famous min ister of Louis X I V was a m

.
,
.
,
an

o f probity f great indus ry and knowledge of detail o f grea t

t ,
o ,

experienc e and a uteness in the examination o f publi a ounts

c c cc ,

and f abilities in short every way fitted for i trodu c ing method
o , ,
n

and good order into the collection and expenditure o f the public
revenue That minister had unfortunately embraced all t he
.

prejudices o f the mercantile system in its nature and essenc e ,

a system o f restraint and regulation and such as could scarce ,

fail to be agreeable to a laborious and plodding man o f busi ess n ,

who had been accustomed to re gulate the d i fferent departments

o f public o ffies and to establish the ne essary hecks and
c ,
c c

c ontrols for onfini g each to its proper S phere The indus t ry

c n .

and commerce of a great country he endeavoured to regulate

u p on the same model as the departments of a public office ;
and instead o f allowing every man to pursue hi w interest s o n

in his own w ay upon the liberal plan of equality liberty d

, , ,
an

justice he bestowed upon certa in branches o f industry extra

,

ordinary privileges while he laid others under as extraord inary

,

restraints He w as not only disposed like other European

.
,

ministers to encourage more the industry of the tow s than that

,
n

o f the country ; but in order to support the indus t ry o f the

,

towns he was willing even to depress and keep dow that o f

, n

the country In order to render provisions heap to the in

. c

habitan ts o f the tow s and thereby to en c ourage m anufacture s

n ,

and foreign ommer e b e prohibited altogether the exportatio

c c ,
n

o f corn and thus ex luded the inhabitants

, f the co untry fro m
c o

every foreign market for by far the most important part f t he o

produce o f their industry This prohibition j oin ed to t he .

,

restrain ts imposed by the an ient provin ial laws o f Franc c c e

upon the transporta tion of corn from one province to another ,

and to the arbitr ry and degrading taxes which are levied upo n
a

the cultivators in almost all the provinces dis ouraged and kep t ,
c

down the agri ulture of that country ve ry much be low the sta t
c e

to whi h it would natu rally have risen in so very fertile a soil

c

and so very happy a limate This state of discouragement c .

1
5 8 T he W e al t h o f N at i o n s
a nd depression w as felt more o less in every different part o f r

the country and many different inquiries were set on foot con
,

c erning the auses o f it O ne o f those causes appeared to be

c .

t he preference given by the institutions f Mr Colbert to t h e

,
o .
,

i ndustry o f the towns above that of the count y r

If the o d be bent too much o e w y says the proverb in

r n a , ,

o rder to make it straight yo u must bend it as much the other .

The Fren h philosophers who have proposed the system which

c ,

r epresents agriculture as the sole sour e f the revenue and wealth c o

o f every ountry seem to have adopted this proverbial maxim ;

c ,

an d as in the plan of Mr Colbert the industry o f the towns w as.

c ertainly over valued in comparison with that of the country ;

-

s o in their system it seems t o be as ertainly undervalued c .

The different orders o f people who have ever been supposed

t o contribute in any respect towards the annual produ c e f the o

land and labour of the country they divide into three c lasses ,
.

The first is the class o f the proprietors of land The se ond is . c

t he class f the cultivators o f farmers and country labourers

o , ,

whom they honour with the pe uliar appellation o f the pro c

d u c t ie class
v The third is the class of a t ific manufacturers
. r er s , ,

a d merchants whom they endeavour to degrade by the humi

n ,
li
at

ing appellation o f the barren unproductive class or .

The class o f proprietors contributes to the annual produce by

th eexpense which they may o c asionally lay out upon the c

i mprovement f the land upon the buildings drains enclosures

o , , , ,

an d other ameliorations whi h they may either make o main ,

c r

tain upon it and by means of which the ultivators are enabled c ,

w ith the same capital to raise a greater produce and ,

o ,
c n

s equently to pay a greater rent This advanced rent may be .

c onsidered as the interest o profit due to the proprietor upon r

t he expense or capital whi c h he thus e m ploys in the improve

m ent o f his land Su h expenses are in this system alled ground
. c c

e xpenses (dé p é )
'

e f en s s o n cz res .

The cultivators farmers ontribute to the annual produce

or c

b y what are in this system called the original and annual

s ex p e
( p
d é
n ses
p im i t i
v i d é
en s esp u ll
r ) which they es o en ses a n n e es

lay out upon the cultivation of the land The original expenses .

c onsist in the instruments o f husbandry in the sto k o f cattle ,

c ,

i the seed and in the maintenance o f the farmer s family

’
n , ,

ervants and cattle during at least a great part of the first year
s ,

o f his occupancy or till he can receive some return from the

,

l and The annual expenses c onsist in the seed in the wear and
.
,

t ear o f the instruments o f husbandry and in the annual main ,

 T he A g r i c u l t u ral S y s t e m s 1
59
t en an c e the farmer s servants and cattle and f his family too
of
’
,
o ,

s o far as any part f them can be considered as se vants e mployed

o r

i ultivation
n c That part f the produ c e o f the land which
. o

re mains to him after paying the rent ought to be suffi ient first c

to replac e to him within a reasonable time at least d u ii

, ,

g the ,
r r

term of his o upancy the whole of his original expenses

cc , ,

together with the ordinary profits of sto k ; and se ondly to c ,

c ,

replace to him annually the whole of his annual expenses ,

t ogether l ikewise with the ordinary profits f sto k Those t w o o c .

s orts o f expenses are two apitals whi h the farmer employs in c c

cultivation ; and unless they are regularly restored to him ,

together with a reasonable profit he annot arry his employ ,

c c on

ment upon a level with other employments but from a regard ,

t o his o w interest must desert it as soon as possible and seek

n ,

s o m e other That part of the produ e o f the land which is

. c

thus ne essary for enabl ing the farmer to continue his business
c

o ught to be considered as a fund sa red to cultivation which if c , ,

the landlord violates he necessarily reduces the produce o f his

,

ow land and in a few years not only disables the farmer from
n ,

paying this racked rent but from paying the reasonable rent ,

w hich he m ight otherwise have g t for his land The rent which o .

properly belongs to the landlord is no more than the net

produ e which re mains after paying in the co mpletest manner
c

a ll the necessary expenses which must be previously laid ut in o

o rder to raise the gross o the whole produce It is because the r .

labour o f the cultivators over and above paying co mpletely all ,

t hose necessary expenses affords a net produce f this kind ,

o

that this class of people are in this system peculiarly dis

t i gu ihed by the honourable appellation f the productive class
n s o .

Their original and annual expenses are for the same reason
c alled in this system productive expenses because over and
, , , ,

a bove repla in g their o w c value they occasion the annual n ,

r eproduction of this net produce .

The ground expenses as they are called what the landlord, ,

or

lays out upon the improvement of his land are in this system , ,

t o honoured with the appellation f productive expenses

o ,
Till o .

the whole f those expenses together with the ordinary profits

o ,

o f stock have be en
,
ompletely repaid to h im by the advanced
c

r ent whic h he gets from his land that advanced rent ought to ,

be regarde d as sacred and inviolable both by the church and ,

b y the king ; ought to be subj ect neither to tithe nor t taxation o .

I f it is otherwi se by dis c our aging the improvement of land the

,

c hurch di scourage s the future increase o f her o wn tithes and ,

 1 60 T he W e al t h of N a t i o n s
the king the future in c rease o f his o wn taxes A s i n a we ll .

ordered state of things therefore those ground expenses ove r , , ,

and above reproducing in the completest manner their w o n

value occasion likewise after a certain time a reproduction f a

, o

net produce they are in this system considered as productiv e

,

expenses .

The ground expenses o f the landlord however together with , ,

the original and the annual expenses f the farmer are the only o ,

three sorts of expenses which in this system are considered as

productive All other expenses and all other orders f people
. o ,

even those who in the common apprehensions o f men are regarded

as the most productive are in this account o f things represente d ,

as altogether barren and unproductive .

A ti
r fic e s and manufacturers in particular whose in dustry
r , ,

in the common apprehensions o f men increases so much t he ,

value o f the rude produce o f land are in this system represente d ,

as a class o f people altogether barren and unproductive Their .

labour it is said replaces only the stock which employs them

, , ,

together with its ordinary profits That stock consists in t he .

materials tools and wages advanced to them by their em

, ,

ployer ; and is the fund destined fo their employment and r

maintenance Its profits are the fund destined for the main
.

t
en a c e o f their employer
n Their employer as he advances t o .
,

them the stock o f materials tools and wages necessary for their , ,

employment so he advan es t himself what is necessary fo r

,
c o

his o w mainte n ance and this maintenance he generally pro

n ,

portions to the profit which he expe ts to make by the price o f c

their work Unless its pri c e repays to him the maintenan e

. c

whi h he advances t o himself as well as the materials tools

c , , ,

and wages which he advan es to his workmen it evidently doe c ,

s

n o t repay t o him the whole expense which he lays o u t upon it .

The profits o f manufa c turing sto k therefore are not like t he c ,

rent o f land a net produ e whi h remains after c ompletely e

,
c c r

paying the whole expense whi h must be laid o ut in order t o c

obtain them The stock o f the farmer yields him a profit as

.

well as that o f the master manufac turer ; and it yields a rent

likewise to another p er o which that of the master ma uf c s n, n a

turer does o t The expense therefore laid o ut in employing

n .
, ,

and maintaini g t ific e s and manufacturers does no more than

n ar r

continue if o e may say so the existence f its o w value and

,
n ,
o n ,

does o t produce any new value It is therefore altogether a

n .

barren and unproductive expense The expense o the con .

,
n

t a ry l aid o ut in employing farmers and country labourers

r , ,
 Th e A g r i c u l t u ral S y s t e m s 1 61

o ver and above continuing the e xistence o f its o wn val ue ,

produ es a new value the rent of the landlord It is therefore

c ,
.

a productive expense .

Mer antile sto k is equally barren and unproductive with

c c

manufacturing stock It only ontinues the existence o f its

. c

ow n value without produ ing any new value Its profits are
,
c .

o nly the repayment of the maintenance whi h its employer d c a

vances to himself during the time that he employs it till he ,

or

receives the returns f it They are only the repayment o f a

o .

p art of the expense which must be laid out in employing it .

The labour of a t ific e and manufacturers never adds any

r rs

thing to the value o f the whole annual amount o f the rude

produce o f the land It adds indeed greatly to the value of
.
, ,

s ome particular parts of it But the onsumption which in the . c

m eantime it occasions of other parts is precisely equal to the

value which it adds to those parts ; so that the value o f the
whole amount is not at any one moment o f time in the least
, ,

a ugmented by it The person who works the lace o f a pair

.

o f fine ru ffl es for example will sometimes raise the value of

, ,

perhaps a pennyworth of flax to thirty pounds sterling B ut .

though at first sight he appears thereby to multiply the value

o f a part of the rude produce about seven thousand and two

hundred times he in reality adds nothing to the value of the

,

w hole annual amount of the rude produce The working o f .

that lace costs him perhaps two years labour The thirty ’
.

pounds whi h he gets for it when it is finished is no more than

c

the repayment of the subsistence which he advan es to himself c

d uring the two years that he is employed abo u t it The value .

w hi ch by every day s month s year s labour he adds to the

’ ’ ’
, , ,
or ,

fl ax does no more than replace the value of his o w o sump n c n

t ion during that day month or year At no moment of time

, ,
.
,

t herefore does he add anything to the value f the whole annual

,
o

a mount of the rude produce o f the land the portion o f that :

produce whi h he is conti ually consuming being al w ays equal

c n

t o the value whi h he is continually producing

c The extreme .

poverty of the greater part o f the persons employed in this

e xpensive though trifling manufacture may satisfy us that the
p ric e of their work does not in ordinar y cases exceed t he value
o f their subsisten e It is otherwise With the work of farmers
c .

a n d country labourers The rent of the landlord is a value

.

which in ord inary cases it is continually prod ucing over and

, , ,

a bove replacing in the most complete manner the whole con

, ,

11 F 2
1 62 W e a l t h o f N at i o n s
Th e
sumption the whole expense l aid t upon the employmen t
,
ou

and maintenan e both f the workmen and of their employer

c o .

Art ific e s manufacturers and merchants can au gment t he

r , ,

revenue and wealth of their so iety by parsimony only ; or s c ,

a

it is expressed in this system by privation that is by depriving , , ,

themselves of a part o f the funds destined for their o w n sub

sistence They annually reproduce nothing but those funds
. .

Unless therefore they annually save some part of them unles s

, , ,

they annually deprive themselves o f the enjoyment o f some

part of them the revenue and wealth of their so c iety can never
,

be in the smallest degree augmented by means o f their industry .

Farmers and ountry labourers c the contrary may enjo y ,

on ,

c ompletely the whole funds destined for their o w subsisten e n c ,

and yet augment at the same time the revenue and wealth f o

their society Over and above what is destined f their o w

. or n

subsistence their industry annually affords a net produce f

, ,
o

whi h the augmentation necessarily augments the revenue and

c

wealth f their so iety N ations therefore whi h like Fran e

o c . c ,
c

o rEngland onsist in a great measure o f proprietors and ulti

,
c c

v at can be enriched by industry and enjoyment N ations

o rs .
,

on the ontrary whi h like Holland and Hamburg are c m

c ,
c , ,
o

posed chiefly f mer hants t ifi s and manufa turers can

o c ,
ar c er ,
c

grow ri h only through parsimony and privation As the i

c . n

t t
eres f nations so diff erently ircumstan ed is very different
o c c ,

so is likewise the ommon hara ter f the people in those o f

c c c o :

the former kind liberality frankness and good fellowship , ,

naturally make a part f that ommon character in the latter o c : ,

narrowness meanness and a selfish disposition averse to ll

, , ,
a

social pleasure and enjoyment .

The unprodu tive lass that f mer hants t ifi e s a d

c c ,
o c ,
ar c r ,
n

manufa turers is maintained and employed altogether at the

c ,

expense f the two other lasses of that o f proprietors and of

o c , ,

that o f cultivators They furnish it both with the materials f

. o

i ts work and with the fund of its subsisten e with the orn d c ,
c an

c attle whi c h it consu m es w hile it is e mployed about that work .

The proprietors and ultivators finally pay both the wages o f

c

all the workmen o f the unproductive class and o f the profits ,

o f all their employers Those workmen and their employers e

. ar

properly the se vants f the proprietors and cultivators They

r o .

are only servants who work without doors as menial servants ,

work within Both the e and the other however are equally
. on , ,

maintained at the expense o f the same masters The labour f . o

both is equally unproductive It adds nothing to the value o f .

 c u l t u r al S y s t e m s
Th e A g r i 16
3
the sum total o f the rude produce o f the land I tead f . ns o

in creasin g the value of that sum total it is a charge and expens e ,

which must be paid o ut of it .

The unproductive class however is not only useful b u t , , ,

greatly useful to the other t wo lasses By means o f the i c . n

du st ry o f merchants fic e
rt i and manufa turers the pro
,
a rs , c ,

pr ie t and
o rscultivators can pur c hase both the foreign good s

and the manufactured produ e f their o w country whi h they c o n c

have oc a ion fo with the produ c e o f a mu h smaller quantity

c s r c

o f their own labour than what they would be obliged to emplo y

if they were to atte mpt in an awkward and unskilful manner , ,

either to import the to make the other for their own

o ne or

use By means f the unproductive c lass the cultivators e

. o ,
ar

delivered from many cares which would otherwise distract thei r

attention from the cultivation of land The superiority of pro .

du c e which in consequen e o f this undivided attention they

, ,
c ,

are enabled to raise is fully su ff cient to pay the whole expens

,
i e

whi h the maintenan e and employment of the unproductiv

c c e

class costs either the proprietors or themselves The in dustry .

of mer hants t ific

c and manufa turers though in its w
,
ar er s , c ,
o n

nature altogether unprodu tive yet contributes in this man e c ,

n r

in directly to in rease the produ e f the land It increases t he

c c o .

productive powers o f produ tive labour by leaving it at liberty c

to onfine itself to its proper employment the ultivation o f

c ,
c

land ; and the plough goes frequently the easier and the bette r
by m eans o f the labour f the man whose business is mos t o

remote from the plough .

It never be the in terest of the proprietors and cultivator

c an s

to restrain to discourage in any respe t the i dustry o f mer

or c n

chants t ifi ,
and manufac turers The greater the liberty
ar c er s , .

whi h this unprodu tive lass enjoys the greater will be t he

c c c ,

competition in all the different trades whi h ompose it and the c c ,

cheaper will t h other t w lasses be supplied both with foreign

e o c ,

goods and with the manufa tured produ e o f the ir w c c o n

country .

It never be the interest o f the unproductive cl ss t o

c an a

oppress the other two classes It is the surplus produ e o f the . c

land w hat remains after dedu c ting the maintenanc e first f

,
or , ,
o

the cultivators and afterwards of the proprietors that mai

, ,
n

tains an d employs the unproductive class The greater this .

surplus the greater must l ikewise be the maintenan e and c

employment o f that clas s The establishment o f perfect justi e . c ,

o f perfect li b erty and of perfe t equality is the very simpl e

,
c
 1 64. The W eal t h of N at i o n s
s ecret which mo st e ffectually secures the highest degree o f
prosperity to al l the three classes .

The merchants rt ific ers and manufacturers o f those mer

,
a ,

c an ti le states which like Hd lla d and Hamburg consist chie fly

,
n ,

o f this unprodu c tive class are in the same manner maintained

,

an d employed altogether at the expense f the proprietors o

and cultivators o f land The only differen e 5 that those pro

. c 1 ,

i t
r e o s and cultivators are
r the greater part of them placed
p , ,

at a most in onvenient distance from the merchants a t ific e s

c ,
r r ,

and manufac turers whom they supply with the materials of their
work and the fund o f their subsistence —the inhabitant s o f ,

other countries and the subjects o f other governments .

Such mercantile states however are not only useful but

, , ,

greatly useful to the inhabitants o f those other countries They .

fill up in some measure a very important void and supply the

, , ,

place o f the merchants a t ific er and manufacturers whom the

,
r s,

inhabitants of those countries ought to find at home but whom , ,

from some defect in their policy they do o t find at home ,

n .

It can never be the interest of those landed nations if I may ,

c all them so to discourage o distress the industry o f such

,
r

mercantile states by imposing high duties upon their trade o r

upon the commodities which they furnish Such duties by .

,

rendering those commodities dearer could serve only to sink ,

the real value o f the surplus produce o f their o w land with n ,

w hich o ,
what comes to the same th ing with the pr i ce o f
r, ,

w hich those commodities are purchased Such duties could .

s erve only to discourage the increase o f that surplus produce ,

a d consequently the improvement and cultivation o f their

n

o wn land The most e ffectual expedient o the contrary for

.
,
n ,

raising the value o f that s urplus produce fo r encouraging its ,

increase and consequently the improvement and cultivation

,

o f their own land would be to allow the most perfect freedom

,

to the trade o f all such mercantile nations .

This perfect freedom o f trade would even be the most e ffectual

e xpedient for supplying them in due time with all the ar t ific er
, ,
s,

m anufacturers and merchants whom they wanted at home and

, ,

fo filling up in the properest and most advantageous manner

r

that very important void which they felt there .

The continual increase of the surplus produce o f their land

would in due time create a greater capital than wha t could be
, ,

e mployed with the ordinary rate o f profit in the improvement

and cultivation o f land ; and the surplus part of it would

n aturally turn itself to the employment o f a t ific ers and manu r
 Th e A g r i c u l t u ral S y s t em s 1 65

fa c t urersat home But those art ific e s and manufacturers

. r ,

finding at home both the materials o f their work and the fund
of their subsistence might immediately even with much less art
,

and skill be able to work as cheap as the like a t ific er and manu r s

fa c t ure of su h mercantile states w h had both to bring from

rs c o

a great distance Even though from want o f art and skill

.
, ,

they might not fo r some time be able to work as cheap yet , ,

finding a market at home they might be able to sell their work

,

there as cheap as that f the rt ific e and manufacturers o f

o a rs

such mercantile states which could o t be brought to that

,
n

market but from so great a distance ; and as their art and skill
improved they would soon be able to sell it cheaper Th
,
. e

ar t ific er and manufacturers o f such mercantile states there

s ,

fore would immediately be rivalled in the market o f those

,

landed nations and soon after undersold and jostled out o f it

,

al t ogether The cheapness o f the manufactures o f those landed

.

nations in consequence o f the gradual improvements o f art and

,

skill would in due time extend their sale beyond the hom
, , ,
e

market and carry them to many foreign markets from which

, ,

they would in the same manner gradually jostle out many o f t he

manufactures of such mercantile nations .

This continual increase both of the rude and manufacture d

produce o f those landed nations would in due time create a
greater capital than could with the ordinary rate o f profit b e
, ,

employed either in agriculture o in m anufactures The surplu r . s

o f this capital would naturally turn itself to foreign trade and ,

be employed in exporting to foreign countries such parts o f t he

rude and manufactured produ e f its w country as exceeded c o o n

the demand o f the home market In the exportation o f t he .

produce f their o w country the merchants o f a landed nation

o n ,

would have an advantage of the same kind over those o f

mercantile nations which its t ific e s and manufacturers had ar r

over the t ific e s and manufacturers o f such nations ; t h

ar r e

advantage o f finding at home that cargo and those stores and

provisions which the others were obliged to seek f at a or

distance With inferior art and skill in navigation therefore

.
, ,

they would be able to sell that argo as cheap in foreign markets c

as the merchants o f such mercantile nations ; and with equal

art and skill they would be able to sell it cheaper They would .

soon therefore rival those m ercantile nations in this branch f

, ,
o

foreign trade and in due time would j ostle them ut o f it

,
o

altogether .

Ac cording to this liberal and generous system therefore t he , ,

1 66 Th e W e al t h of N at i o n s
m ost advantageous method in which a landed nation can raise
up ti
arfie manufacturers and merchants of it s o w n is to
c r s, ,

g rant the most perfect freedo m f trade to the t i

fi c e manu o ar rs ,

f c t u r s and merchants o f all other nations

a er ,
It thereby raises .

the value o f the surplus produce o f its own land o f which the ,

c ontinual increase gradually establishes a fund which in due ,

time necessarily raises up all the t ific er manufacturers and ar s, ,

m erchants whom it has occasion for .

When a landed nation on the contrary Oppresses either by , ,

h igh duties o by prohibitions the trade f foreign nations it

r o ,

necessarily hurts its own interest in two different ways First .

,

by raising the price of all foreign goods and o f all sorts o f manu
f actures it necessarily sinks the real value o f the surplus produce
,

o f its o w land with which o r what comes t o the same thing

n , , , ,

with the price o f which it purchases those foreign goods and

manufactures Secondly by givin g a sort o f monopoly o f the
.
,

home market to its own merchants t ific e s and manufacturers ,

ar r , ,

i t raises the rate of mercantile and manufacturing profit in

proportion to that f agricultural profit and consequently either
o ,

d raws from agriculture a part o f the capital which had before

been employed in it o r hinders from going to it a part o f what
,

would otherwise have gone to it This policy therefore dis .

, ,

c ourages agriculture in two di fferent ways ; first by sinking the ,

real value o f its produce and thereby lowering the rate o f its,

profit ; and secondly by raising the rate o f profit in all other

, ,

e mployments Agriculture is rendered less advantageous and

.
,

t ade and manufactures more advantageous than they otherw ise

r

would be ; and every man is tempted by his o w interest to n

turn as much as he can both his capital and his industry from
, ,

the former to the latter employments .

Though by this Oppressive policy a landed nation should be

, ,

a ble to raise up ar t ific er manufacturers and merchants o f its

s, ,

o w somewhat sooner than it could do by the freedom o f trade

n

a matter however which is not a little doubtful—yet it would

, ,

raise them up if one may say so prematurely and before it

, , ,

w a s perfectly ripe for them By raising up too hastily o n e .

s pecies o f industry it would depress another more valuable

,

species of industry By raising up too hastily a species p f

.

indust ry which only repla es the stock whi c h employs ’t ’ c

together with the ordinary profit it would depress a spec i es

.

,
-
o f indust ry which over and above replac i ng that stock with it s
,

profit affords likewise a net produce a free rent to the land

, ,

l ord I t would depress productive labour b y encourag ng

.
,
i
 Th e A g r i c u l t u ral S y s t em s 1 67
t oo hastily that l abour which is altogether barren and un
productive .

In what manner accordin g to this system the sum total o f

, ,

the annual produce o f the land is distributed among the three

classes above mentioned and in what manner the labour of the ,

unproductive class does no more than replace the value f its o

ow nconsumption without increasin g in any respect the value

,

o f that sum total is represented by Mr Que i the very

, . sn a ,

in genious and profound author o f this system in some arith ,

metical formularies The first o f these formularies which by

.
,

w y of eminence he peculiarly distin guishes by the name o f the

a

E conomical Table represents the manner i ,

n which he supposes

this distribution takes place in a state f the most perfect liberty o

a d therefore of the highest prosper i ty—i a state where the

n n

annual produce is such as to afford the greatest possible net

produce and Where each class enj oys its proper share o f the
,

whole annual produce Some subsequent formularies represent

.

the manner in which he supposes this distribution is made

in di fferent states o f restra i
nt and regulation ; in which either
the class o f proprietors o r the barren and unproductive class is
more favoured than the class f cultivators and in which either o ,

the o e o r the other encroaches more o r less upon the share

n

which ought properly to belong to this productive class Every .

such encroachment every violation of that natural distribution

, ,

which the most perfect liberty would establish must a cording , ,

c

t o this system necessarily degrade more o less from

,
e year r ,
on

t o another the v al ue and sum total o f the an ual produce and

,
n ,

must necessarily occasion a gradual de lension in the real wealth c

a d revenue o f the society ; a declension of which the progress

n

must be quicker o slower according to the degree o f this e

r ,
n

c ro c hme t
a a cording as that natural distribution which the
n ,
c

most perfect liberty would esta blish is more o less violated r .

Those subsequent formularies represent the different degrees

o f declension w hich according to this system co respond to the
, ,
r

d ifferent degrees i
n whi ch this natural distribution is violated .

Some speculative physicians seem t o have imagined that the

h ealth f the human body could be preserved o n ly by a certain
o

precise regimen o f diet and exercise f which eve y the smallest ,

o r , ,

v iolation ne essarily o asioned some degree f disease or dis

c cc o

o rder proportioned to the degree of the violation Exp erience .

,

h owever would see m to show that the hu m an body frequently

,
preserves to all appearance at least the most perfect state o f
, ,

h ealth under a vast variety of different regimens ; even under

 1 68 The W eal t h of N a t i o n s
some whi ch are generally believed to be very far from being
perfectly wholesome But the healthful state f the human . o

body it would seem contains in itself some unknown principl e

, ,

o f preservation capable either of preventing o ,

f orrecting r o c ,

in many respects the bad e ff e ts even of a very faulty regimen

,
c .

M r Ques i who was himself a physician and a very specula

. na , ,

tive physician seems to have entertained a notion of the same

,

kind concerning the political body and to have imagined that ,

i t would thrive and prosper only under a certain prec se regimen i ,

t he exact regimen o f perfe t liberty and perfect justice He c .

seems o t to have considered that in the politi al body t he

n ,
c ,

natural e ffort which every man is continually making to better

his o wn condition is a principle o f preservation capable o f
preventing and correcting in many respects the bad e ffects of , ,

a politi al economy in some degree both partial and oppressive

c , ,
.

Such a political economy though it no doubt retards more or ,

l ess is not always capable o f stopping altogether the natural

,

progress o f a nation towards wealth and prosperity and stil l ,

less o f making it go backwards If a nation could not prospe r .

without the enjoyment o f perfect liberty and perfect justi e c ,

there is o t in the world a fi t io which could ever have prospered

n a n .

In the political body however the wisdom o f nature has for , ,

t u a t ely made ample provision for remedying many o f the bad

n

e ffects o f the folly and injusti e o f man in the same manner c ,

as it has done in the natural body fo remedying those o f his r

sloth and intemperance .

The capital error of this system however seems to lie in it s , ,

representing the lass o f a t ific e manufacturers and merchants

c r rs , ,

as altogether barren and unproductive The following observa .

tions may serve to show the impropriety o f this representation .

First this c lass it is acknowledged reproduces annually the

, , ,

value o f its o w annual consumption and ontinues at least t he

n ,
c , ,

existence of the stock or capital which maintains and employs

But upon this ac ount alone the denomination o f barren o r
'
’

t . c

unproductive should seem to be very improperly applied to it .

We should o t call a marriage barren o unproductive though

n r

it produced only a son and a daughter to replace the father and ,

mother and though it did not increase the number o f the human
,

spe ies but only continued it as it wa before Farmers and

c ,
s .

country labourers indeed over and above the stock which , ,

maintains and employs them reprodu e annually a net pro ,

c ,

duce a free rent to the landlord As a marriage whi h affords

,
. c

three children is certainly more produ tive than o e which c n

 T h e A g r i c u l t u r al S y s t e m s 16
9
affords only t w o ; so the labour o f farmers and country labo urers
is certa m more productive than that of merchants a rt ific e s ,
r ,

and manufact urers The superior produce of the one class

.
,

however does not render the other barren or unproductive

,
.

Secondly it seems upon this ac count altogether imprope r

, , ,

to consider art ific e s manufacturers and merchants in t her , ,

same light as menial servants The labour f menial servants . o

does not continue the existence o f the fund which maintains and
employs them Their main tenance and employment is alt
. o

gether at the expense o f their masters and the work which the ,
y

perform is not o f a nature to repay that expense That work .

consists in services whi h perish generally in the very in sta n t c

o f their performance and does t fix o r realise itself in any

,
no

vendible commodi t y whi h can replace the value o f their wages c

and maintenance The labour on the contrary o f rt ific e s

.
, ,
a r ,

manufacturers and merchants naturall y does fix and realise

,

itself in some such vendible commodity It is upon this ac ount . c

that in the chapter in which I treat of productive and u p o

,
n r

duc t ie labour I have classed art i

v fic e
,
manufa ture s a d rs , c r ,
n

merchants among the productive labourers and menial servants ,

among the barren or unproductive .

Thirdly it seems upon every supposition improper to say

,

that the labour of a rt ific e manufacturers and merchants doe s rs , ,

n o t in crease the real revenue o f the society Though we should .

suppo se fo example as it seems to be supposed in this system

,
r , ,

that the value of the daily monthly and yearly consumption f , ,

o

this class w as exactly equal to that o f its daily monthly an d , ,

yearly produ tion yet it would not from then c e follow that it s
c ,

labour added nothin g to the real revenue to the real value o f ,

the annual produce of the land and labour o f the society A11 .

a tir fic er for example who i

,
n the first six months after harvest
, , ,

executes ten pounds worth o f work though he should in t he ’

,

same time con ume ten pounds worth o f corn and other meces
s
’

sa ies yet really adds the value of ten pounds to the an ual
t ,
n

produce of the land and labour o f the socie t y While he ha . s

been consuming a half yearly revenue o f ten pounds worth f -

’
o

and other necessaries he has produ ed an equal value f ,

c o

capable o f pur hasing either to himself or to some othe

c ,
r

an equal half yearly revenue The value therefore o f

11 , -
.
, ,

h been consumed and produ ed during these six months

as c

pounds It is possible .
,

worth o f this value may

o f time But if the t e . n
.
 1
7 0 T he W eal t h of N at i o n s
p ounds worth ’
o f orn and other necessaries which
c were con ,

s umed by the tific er had been onsumed by a soldier o by a

ar ,
c r

menial se vant the value o f that part of the annual produce

r ,

whi h existed at the end o f the six months would have been
c

t e pounds less than it actually is in consequence of the labour

n

o f the ti fic e
ar Though the value of what the a t ific e produces
r . r r ,

t herefore should not at any one moment of time be supposed

,

g reater than the value he consumes yet at eve r y moment of time ,

the actually existing value o f goods in the market is in c o e ,

ns

q u e c e nf what he
o produ es greater than it otherwise would be c , .

When the patrons o f this system assert that the consumption

o f a tifi r manufa turers and merchants is equal to the value
c ers , c ,

o f what they produce they probably mean no more than that ,

t heir revenue the fund destined fo their consumption is

,
or r ,

e qual to it But if they had expressed themselves more

.

accurately and only asserted that the revenue of this class

,

w as equal t o the value of what they produced it might readily ,

have occurred to the reader that what would naturally be saved

o u t o f this revenue must necessarily increas e more o r less the
«

r eal wealth of the society In order therefore to make ut .

, ,
o

something like an argument it was necessary that they should ,

e xpress themselves as they have done ; and this argument even ,

s upposing things actually were as it seems to presume them t o

be turns out to be a very inconclusive one
,
.

Fo u t hly farmers and ountry labourers can no more augment

r ,
c ,

without parsimony the real revenue the annual produce of the , ,

land and labour o f their society than a t i fic e s manufacturers ,

r r , ,

a d merchants
n The annual produce of the land and labour o f
.

a y society can be augmented only in two ways ; either first

n , ,

b y so m e improvement i the productive powers o f the useful n

l abour actually maintained within it ; o r secondly by some , ,

increase in the quantity o f that labour .

The improvement in the productive powers o f useful labour

d epend first upon the improvement in the ability o f the work
‘

, ,

m a ; and secondly upon that of the machinery with which

n , ,

he works But the labour o f a t ific s and manufacturers as

. r er ,

it is capable o f being more subdivided and the labour o f each ,

w orkman reduced to a greater simplicity of operation than that

o f farmers and country labourers so it is likewise capable o f ,

b oth these sorts f improvement in a much higher degree o In .

1

t his respect therefore the class o f cultivators can have no sort

, ,

o f advan t age over that o f a t i fic e s and manufacturers r r .

S b ki h p i 1
ee oo . c a . .
 T he A g r i c u l t u r a l S y s t e m s 1
7 1

Th e increase in the quantity o f useful labour actually em

p
loyed within any so iety must depend altogether
c upon the
incre as e o f the capital which employs t ; and the i cre as e of i n

that ca pita l again must be exactly equal to the amount o f the

s avings from the revenue either o f the particular persons who
,

manage and d irect the employment o f that apital or of some c ,

o ther persons who lend it to them If m er hants r t ific e s and . c ,

a r ,

manufa turers are as this system seems to suppose naturally

c , ,

more inclined to parsimony and savin g than proprietors and

c ultivators they are so far more likely to augment the quantity
, , ,

o f useful labour employed within their society and consequently ,

to increase its real revenue the annual produce of its land and ,

labour .

Fift hly and lastly though the revenue o f the i nhabitants of

,

every country was supposed to consist altogether as this system ,

seems to suppose in the quantity o f subsistence which their

,

i ndustry could procure to them ; yet even upon this supposi ,

tion the revenue f a trading and manufacturing country must

,
o ,

other things being equal always be much greater than that o f

,

o e without trade o r manufactures

n By means f trade and . o

manufactures a greater quantity o f subsistence can be annually

,

imported into a particular country than what its o wn lands in ,

the actual state o f their cultivation could afford The ihab i ,

. n

tants o f a town though they frequently possess no lands o f

,

t heir o wn yet draw t o themselves by their industry such a

,

quantity o f the rude produce f the lands o f other people as o

s upplies them not only with the materials

,
f their work but o ,

with the fund o f their subsistence What a town always is with .

r egard to the country in its neighbourhood o e independent ,

n

s tate or country may frequently be with regard to other inde

pendent states o r countries It i s thus that Holland draws a .

great part o f its subsistence from other countries ; live ca ttle

from Holstein and Jutland and corn from almost all the different
,

c ountries o f Europe A small quantity o f manufactured p o

. r

duce purchases a great quantity f rude produce A tradin g o .

and manufacturing country therefore naturally purchases with , ,

a small part o f its manufactured produce a great part o f the

rude produce of other countries ; whil e o the contrary a ,
n ,

country without trade and manufactures is generally obliged to

purchase at the expense o f a great part o f its rude produce a
, ,

very small part o f the manufactured produce f other countries o .

The o e exports what can subsist and accommodate but a very

n

few and imports the subsistence and accommodation o f a great

,
 1
7 2 W Th e
e al t h of N a t i o n s

number The other exports the accommo d ation and subsistenc

. e
of a great number and imports that of a very few only The
, .

inhabitan ts o f the one must always enjoy a much gr eater quan

tity o f subsistence than what their own lands in the a tual ,
c

state o f their cultivation could afford The inhabitants of the

,
.

other must always enj oy a much smaller quantity .

This system however with all its imperfections is perhaps

, , , ,

the nearest approximation to the truth that has yet been pub
lih ed upon the subj ect of political economy and i s upon that
s ,

account well worth the consideration of every man who wishes

to examine with attent i on the principles o f that very important
science Though in representing the labour which is employed
.

upon land as the only productive labour the notions which it ,

inculcates are perhaps too narrow and confined ; yet in repre

,

sentin g the wealth of nations as consisting not in the un c n ,

o

sumable riches of money but in the consumable goods annually

,

reproduced by the labour of the society and in representin g ,

perfect liberty as the only e ff ectual expedient for rendering thi s

annual reproduction the greatest possible its doctrine seems t o ,

be in every respect as just as it is generous and liberal Its .

followers are very numerous ; and as men are fond o f paradoxes ,

and o f appearing to understand what surpasses the compre

he i o
ns nof ordinary people the paradox whi h it maintains
,
c ,

concerning the unproductive nature f manufacturing labour o ,

has not perhap s contributed a little to increase the number of

its admirers They have for some years past made a pretty
.

considerable sect distinguished in the French republic of letters

,

by the name o f The Economists Their works have certainly .

bee of some se rvice to their country ; not only by bringing

n

i nto general discussion many subj ects which had never been
well examined before but by influencing in some measure
,

the public adm inistration in favour o f agriculture It has been .

in consequence of their representations accordingly that the , ,

agriculture of France has been de livered from several o f the

Oppressions which it before laboured under The term during .

which such a lease can be granted as will be valid against every

,

future purchaser o r proprietor of the land has been prolonged ,

from nine to twenty seven years The ancient provincial e

-

. r

straints upon the transportation o f corn from o e province o f n

the kingdom to another have been entirely taken away and the ,

liberty of exporting it to all foreign countries has been estab

lihed as the common law of the kingdom in all ordina ry cases
s .

This sect i n their works which are very numerous and which
, , ,
 T h e A g r i c u l t u r al S y s t e m s 1
73
treat not only o f what is properly called Politica l Economy o r ,

o f the nature and causes of the wealth o f nations but f every ,

o

o ther branch o f the system f civil government all follow i m o ,

p lic it ly and without any sensible variation the doctrine o f Mr ,

.

Q u es n a i There
. is upon this account little variety in the greater
part f their works The most distinct and best connected
o .

account of this do trin e is to be found in a little book written

c

by Mr Mercier de la Riviere some time Intendant of Martinico

.
, ,

e ntitled Th N tu l
,
ed E ti l O d
a ra f P litian l S i ti s s s en a r er o o ca oc e e .

The admiration o f this whole sect for their master w ho w a s ,

h imself a man f the greatest modesty and simplicity is n o t

o ,

inferior to that f any f the ancient philosophers for the founders

o o

o f their respective systems There have been s ince the world .

,

began says a very diligent and respectable author the Marquis

,
”
,

d e Mirabeau three great inventions which have principally

,

given sta bility to political societies independent o f many o ther ,

inventions which have enriched a d adorned them The first n .

is the invention o f writing which alone gives human nature the ,

power of transmitting without alteration its laws its contracts

, , , ,

its annals and its discoveries The second is the invention of

, .

money which binds together all the relations between civilised

,

s ocieties The third is the Economica l Table the result o f

.
,

the other two whi h complete s them both by perfecting their

,
c

object ; the great discovery o f u age but o f which o ur po sterity o r ,

w ill reap the benefit

”
.

As the politica l e onomy o f the nations f modern Eu rOpe has

c o

b een more favourable to manufactures and foreign trade the ,

in dustry o f the towns than to agriculture the industry of the , ,

country ; so that of other nations has followed a different plan ,

and has been more favourable to agriculture than t o manu

factures and foreign trade .

The policy o f China favours agriculture more than all other

e mployments In Ch ina the condition o f a labourer is said to
.

be as much superior to that f an t ific e as in most parts of o ar r

Europe that of an rt ific e is to that o f a labourer In China

a r .
,

the great ambition o f every man is t o get possession o f some

little bit o f land either i property o r in lease ; and leases are
,
n

there said to be granted upon very moderate terms and t o ,

be sufficiently secured to the lessees The Chinese have little .

respect for foreign trade Your beggarly commerce "w a the . s

language in which the Mandarins f Pekin used to talk to Mr o .

De Lange the Russian envoy concern in g it Except with

, , .
1

th J l f M D L g i B ll T l l ii pp 5 8 76 ’
1
S ee e o urn a o r . e an e n e s r a ve s , v o . . . 2 .
2
an d 2 9 3 .
1
74 , Th e W eal t h of N at i o n s
Japan the Chinese carry on themselves and i n their o w n
, , ,

bottoms little or no foreign trade ; and it is only into o n e or

,

two ports f their kingdom that they even ad mit the ships f
o o

foreign nations Foreign trade therefore is in China every

.
, ,

w y confined within a much narrower circle than that t o which

a

it would naturally extend itself if more freedom w a s allowe d ,

to it either in their own ships or in those of foreign nations

, , .

Manufactures as in a small bulk they frequently contain a

,

great value and can upon that account be transported at les

, s

expense from one country to another than most parts o f rude

produ e are in almost all countries the principal support f
c , , ,
o

foreign trade In countries besides less extensive and les s

.
, ,

favourably circumstan c ed for inferior ommer e than China c c ,

they generally require the support f foreign trade Without o .

an extensive foreign market they could o t well flourish n ,

either i countries so moderately extensive as to afford but

n a

narrow home market or in countries where the o mmu ia c n c

tion between o e province and another was so difficult as t o

n

render it impossible for t he goods of any particular place t o

enjoy the whole o f that home market which the country coul d
afford The perfe tion of manufa turing industry it must b
. c c ,
e

remembered depends altogether upon the division f labour ;

,
o

and the degree to whi h the division f labour can be intro

c o

d u ed into any manufacture is ne c essarily regulated it ha s

c ,

already been shown by the extent o f the market But the

,
.

great extent f the empire of China the vast multitude o f its

o ,

inhabitants the variety of climate and consequently o f pro

, ,

d uc t i in its different provinces and the easy c o mmunication

ons ,

by means of water carriage between the greater part of them ,

render the home market of that ountry o f so great extent as c

to be alone su fficient to support very great manufactures and ,

t o admit of very considerable subdivisions o f labour The home .

market f China is perhaps in extent not much inferior to t he

o , , ,

market of all the different countries of Europe put together .

A more extensive foreign trade however which t o this great , ,

home market added the foreign market of all the rest of t h e

world—especially if any onsiderable part of this trade was c

carried o in Chinese ships—could s ar e fail to increase very

n c c

much the manufa tures o f China and to improve very muc h

c ,

the productive powers of its manufa turing industry By a c .

more extensive navigation the Chinese would naturally learn,

the art o f using and constructing themselves all the differen t

machines made use of in other countries as well as the othe r ,
 Th e A gr i
c u lt u r a l S st e m s
'

y 1
75
‘

improvements of art and industry which are practised in all t he

different parts of the world Upon their present plan they hav e .

little opportunity o f improving themselves by the example o f

any other nation ex c ept that o f the Japanese .

The poli y o f ancient Egypt too and that of the Gento o

c ,

government f Indosta n seem to have favoured agriculture

o ,

more than all other employments .

Both in an ient Egypt and Indostan the whole body o f t he

c

people was divided into different castes or tribes each f whi h ,

o c

was c onfined from father to son to a particular employment o r

, ,

class o f employments The son f a priest was necessarily . o a

priest ; the son o f a soldier a soldier ; the so n of a labourer a , ,

.

labourer ; the o o f a weaver a weaver ; the son f a ta ilor a

s n ,
o ,
.

tailor etc In both ountries the a te of the priests held the

,
. c ,
c s

highest rank and that f the soldiers the next ; and in both
,
o

countries the c aste f the farm ers and labourers was superior to
,
o :

the astes of m er hants and manufa turers

c c c .

The government o f both ountries was parti ularly attentiv e c c

to the interest f agri ulture The works onstructed by t he

o c . c

ancient sovereigns f Egypt for the proper distribution of t he

o

waters o f the N ile were famous in antiquity ; and the m ine d

remains of some o f them are still the admiration o f travellers
Those o f the same ki nd whi h were onstru ted by the an ient c c c c

sovereigns of Indost n for the proper distribution f the waters

a o

o f the Ganges as well as f m any other rivers though they hav e o ,

been less c elebrated seem to have been equally great Both

,
.

countries a ordingly though subje t o asionally to dearths

,
cc ,
c cc ,

have been famous for their great fertility Though both were .

extremely populous yet in years f moderate plenty they were

, ,
o ,

b oth able t export great quantities f grain to their neighbours

o o .

The anc ient Egyptians had a superstitious aversion to t h e

sea ; and as the Gentoo religion does t permit its followers t no o

l ight a fire nor c onsequently to dress any vi tuals upon t he

, c

water it in effect prohibits them from all dista nt sea voyages

, .

Both the Egyptians and Indians must have depended almos t

altogether upon the navigation f other nations for the exporta o

tion f their surplus produ c e ; and this dependen y as it mus t

o c ,

have onfined the market so it must have dis ouraged the

c , c

in c rease o f this surplus produ c e It must have dis ouraged too . c , ,

the increase o f the manufa tured produce more than that f t h c o e

rude produce Manufactures require a mu h more extensive

. c

market than the most important parts of the rude produ e o f c

the land A single shoemaker will make more than three hu

.
n
 1
7 6 The W e al t h of N a t i o n s
d red pairs of shoes in the year ; and his o wn family will not ,

p erhaps wear o u t six pairs

,
Unless therefore he has the custom of .

a t least fifty such families as his w h cannot dispose of the o n, , e

w hole produce f his own labour The m ost numerous class of

o .

a tir fic will seldom in a large country make more than one

er s , ,

i fifty or one in a hundred o f the whole number o f families

n

c ontained in it But in su h large countries as France and

. c

England the number of people employed in agriculture has by

,

s ome authors been omputed at a half by others at a thirdc , ,

a d by no autho r that I know of at less than a fifth o f the

n ,

whole inhabitants o f the country But as the produce o f the .

a gri ulture f both Fran e and England is the far greater part
c o c ,

o f it consumed at ho me each person employed in it must

, , ,

a ording to these omputations require little more than the

cc c ,

c ustom of o e t w o o at most of four such families as his own

n , ,
r ,

order to dispose o f the whole produce f his own labour o .

Agri ulture therefore can support itself under the discourage

c , ,

m ent of a confined ma k et muc h better than manufactures r .

In both ancient Egypt and Indostan indeed the confinement , ,

o f the foreign market was in some measure compensated by the

«

c onvenien y o f many inland navigations whi h opened in the

c ,
c ,

m ost advantageous manner the whole extent of the home ,

m arket to every part f the produce of every different district o

o f those ountries The great extent f Indostan too rendered

c . o , ,

t he home market o f that country very great and su ffi ient t o ,

c

s upport a great variety of manufa tures But the small extent c .

o f an ient Egypt which was never equal to England must at

c , ,

a ll times have rendered the home market of that country too

n arrow for supporting any great variety o f manufactures .

Bengal accordingly the provin e of Indostan whi c h commonly

, ,
c ,
«
exports the gre atest quantity o f rice has always been more ,

r emarkable for the exportation of a great variety f m uf c o an a

t ures than for that o f its grain Ancient Egypt on the con .
,

t a y though it exported some manufactures fine linen in

r r , ,

particular as well as some other goods was always most dis

, ,

t igu i
n shed for i t s great exportation of grain It was long the .

g ranary f the Roman empire

o .

The sovereigns o f China of ancient Egypt and o f the di fferent , ,

kingdoms into which Indostan has at different times been

d ivided have always derived the whole o r by far the mo st
, ,

c onsiderable part f their revenue from some sort of land tax

,
o

o r land rent This land tax o land rent like the tithe in
. r ,

E urope consisted in a certain proportion a fifth it is said of

, , , ,
 The A g r i cu l t u ral S y s t em s 1
77
t he produce o f the land which was either delivered in kin d o r
, ,

paid in money according t o a certa in valuation and which

, ,

therefore varied from year t year according to all the varia o

tions of the produce It w as natural therefore that the sove

.

reigns of those countries should be particularly attentive to t he

interests o f agriculture upon the prosperity or declension f
'

,
o

which immediately depended the yearly increase o r dimin utio n

o f their o w revenue n .

The policy o f the ancient republics of Greece and that o f ,

Rome though it honoured agriculture more than manufacture s

,

o r foreign trade yet seems rather to have discouraged the latter

,

employments than to have given any direct o intentional e r n

c o u ag me t to the former
r e n In several o f the an ient states o f
. c

Greece foreign trade w s prohibited altogether ; and in several

,
a

others the employments of a t ific e s and manufacturers were r r

considered as hurtful to the strength and agility of the huma n

body as rendering it incapable f those habits which their mili

,
o

tary and gymnasti exercises endeavoured to form in it and as

c ,

thereby disqualifying it more o r less fo r undergoing the fatigue s

and encountering the dangers o f war Such occupations were .

considered as fit only for slaves and the free citizens o f t h ,

e

state were prohibited from exercising them Even in thos e .

states where no such prohibition took place as in Rome and ,

.

Athens the great body o f the people were in effe t exclude d

,
c

from all the trades whi h are now commonly exercised by t h

c e

lower sort o f the in habitants o f towns Su h trades were a t . c ,

Athens and Rome all occupied by the slaves of the rich w ho

, ,

exercised them fo the benefit o f their m asters whose wealth

r , ,

power and protection made it almost impossible for a poor

,

freeman to find a market f his work when it came into com or ,

petition with that o f the slaves of the ri h Slaves however c .

, ,

are very seldom inventive ; and all the m ost important im

in the arrangement and

whi h fa ilitate and abridge labour have

c c ,

o f freemen Should a slave propose a y . n

kin d his master would be very apt t o

,
.

as the suggestion of laziness and a desire ,

u at the master s expense The poor

o r
’
.
’

o f reward would probably meet with much a buse

, ,

some punishment In the manufa tures arried . c c

therefore m ore labour must generally have been

,

exe ute the same quantity f work than in thos e

c o
 "
1
7 8 T he W e al t h of N a t i o n s
hat account generally have been dearer than that f the latter
t , o .

The Hungarian mines it is re marked by Mr Montesquieu ,

.
,

t hough not richer have always been wrought with less expense , ,

a d therefore with more profit than the Turkish mines in their

n ,

eighbourhood The Turkish mines are wrought by slaves ;

n .

d the arms of those slaves are the only machines whi h the
an c

Turks have ever thought of employing The Hungarian m ines .

are wrought by freemen who employ a great deal of ma hinery ,

c ,

b y whi c h they facilitate and abridge their own labour Fro m .

t h very little that is known about the price of manufactures in

e
“

the times of the Greeks and Romans it would appear that ,

t hose o f the finer sort were excessively dear Silk sold for its .

weight in gold It was not in deed in those times a European

"

.
, ,

m anufacture ; and as it was all brought from the East Indies ,

t he distance o f the carriage may in some measure a ount for cc

t he greatness f the pri c e The price however which a lady

o .
, , ,

it is said would sometimes pay for a piece of very fine linen

, ,

s eems to have been equally extravagant ; and as linen w as

a lways either a European or at farthest an Egyptian manu , ,

f acture thi s high price can be accounted for only by the great
,

xpense o f the labour which must have been employed about

e

it and the expense f this labour again could arise from nothing
,
o

b ut the awkwardness f the machinery which it made use of o .

Th price of fine woollens too though not quite so extravagant

e , ,

s eems however to have been much above that o f the present

times Some cloths w are told by Pliny dyed in a particular

.
,
e ,

m anner cost a hundred denarii o r three pounds six shillings

, ,

d eightpence the pound weight Others dyed in another 1

‘

an .

manner cost a thousand denarii the pound weight thirty ,

or

three pounds six shillings and eightpence The Roman p ound .

,

it must be remembered conta ined only twelve o f our avoir ,

dupois ounces This high price indeed seems to have been

.
, ,

p rincipally owing to the dye But had not the cloths them .

s elves been much dearer than any which are made in the present

t imes so very expensive a dye would not probably have been

,

b estowed upon them The disproportion would have been too .

g reat between the value f the accessory and that o f the prin o

ci
«
p al The price
. mentioned by the same author of some 2

Ti c li ria a sort of woollen pillows o

r na ,
cushions made use f to r o

lean upon as they reclined upon their couches at table passes ,

a ll credibility ; some of them being said to have cost more than

thirty thou sand others more than three hundred thousand

‘

Pli 1 i x 0 39 1
n . Pli 1 viii.
48 . . .
2
n . . . c . .
 T he A g r i cu l t u r al S y s t e m s 1
79
pou ds This high price t is t said to have arisen from
n .
,
oo, no

the dye In the dress of the people f fashion o f both sexes

. o

there seems to have been much less variety it is observed by ,

Doctor Arbuthnot in ancient than in modern times ; and the

,

very little variety which w e find in that f the ancient statues o

c onfirms his observation He infers from this that their dress

.

must upon the whole have been cheaper than ours ; but the
conclusion does o t seem to follow When the expense of
,

n .

fashionable dress is very great the variety must be very small ,

.

But when by the improvements in the productive powers o f

,

manufacturing art and industry the expense f any one dress ,

o

comes to be very moderate the variety will naturally be very ,

great The rich not being able to distin guish themselves by the
.
,

expense f any one dress will naturally endeavour to do so by

o ,

the multitude and variety of their dresses .

The greatest and most important branch of the commerce f o

every nation it has already been observed is that which is

, ,

c arried on between the inhabita nts o f the town and those of the

c ountry The in habitants of the town draw from the country

.

the rude produce which constitutes both the materials f their o

work and the fund o f their subsistence ; and they p ay for this
rude produce by sendi g back to the country a certain portion
n

o f it manufactured and prepared for immediate use The trade .

w hich is ca ried on between these t w di

r ffere nt sets f people o o

c onsists ultimately in a certain quantity o f rude produce ex

changed for a ce rtain quantity f manufactured produce The o .

d earer the latter therefore the cheaper the former ; and what
, ,

e ver tends in any country to raise the price f manufactured o

produce tends to lower that o f the rude produce of the land ,

and thereby to discourage agriculture The smaller the quan .

tity f manufactured produce which any given quantity o f rude

o

produce what comes to the same thing which the p rice f

,
o r, ,
o

any given quantity of rude produc e is capable f purchasing o ,

the smaller the exchangeable value f that given quantity f o o

rude produce the smaller the encouragement which either the

,

landlord has to increase its quantity by improving or the farmer

by cultivating the land Whatever besides tends to diminish .
, ,

i
n any country the number o f art ific rs and manufacturers e ,

tends to diminish the home market the most important o f all ,

markets for the rude produce o f the land and thereby still ,

further to discourage ag iculture r .

Those systems ther fore which preferrin g agriculture to all

,
e , ,

o ther employments in order to promote it impose restraints

, ,
1 80 T he W e al t h of N at i o n s
upon manufactures and foreign trade act contrary to the very ,

end which they propo se and indirectly discourage that very ,

S pecies o f industry w hich they mean to promote They are s . o

far perhaps more inconsistent than even the mercantile system

, , .

That system by encouraging manufactures and forei gn trade

,

mo e than agriculture turns a certain portion f the capital of

r ,
o

the society from supporting a more advantageous to support a ,

less advantageous Species o f industry But still it really and in .

the end encourages that species o f industry which it means to

promote Those agricultural systems on the contrary really
.
, ,

and in the end discourage their wn favourite species of industry o .

It is thus that every system which endeavours either by ,

extraordin ary encouragements to draw towards a parti c ular

S pecies o f industry a greater share f the capital of the societ y o

than what would naturally go to it o r by extraordin ary e , ,

r

straints force from a p rticular species o f industry some share

,
a

of the capital which would otherwise be employed in it is in ,

reality subvers ive of the great purpose which it means to pro

mote I t retards instead o f accelerating the progress of the
.
, ,

society towards real wealth and greatness ; and dimin ishes ,

instead o f increasing the real value of the annual produce o f

,

its land and labour .

All system s either o f preference o r of restraint therefore , ,

being thus completely taken away the obvious and simple ,

system of natural liberty establishes itself o f its w accord o n .

Every man as long as he does not violate the law s of justice

, ,

is left perfectly free to pursue his o wn interest his wn way and o ,

to b ing both his industry a d capital into competition with

r n

t hose o f any other man o order f men The soverei gn is ,

r o .

completely discharged from a duty in the attempting to per ,

form which he must always be exposed to innumerable delu

sions and for the proper performance o f which no human wisdom
,

o r knowledge could ever be su ffi cient ; the duty o f superintend

ing the indu try of private people and of directing it toward s
s ,

the employments most suitable to the interest of the society .

According to the system of natural liberty the sovereign has ,

onl y three duties to attend to ; three duties of great importan ce ,

indeed but plain and intelligible to common understandings :

,

first the duty o f protecting the societ y from the violence and
,

invasion of other independent societies ; secondly the duty of ,

protecting as far as possible every member of the society from

, ,

the injustice o r Oppression o f eve ry other member o f it o r the ,

duty o f establishing an exact administration o f justice ; and ,

 The A g r i c u l t u ral S y s t e m s 181

t hirdly the duty o f erecting and mainta ining certain public

,

works and certain public institutions which it c an never be for

the interest o f any individual or small number of individuals
, ,

to erect and maintain ; because the profit could never repay the
expense to any indi v idual o small number f indi v iduals though
r o ,

i t may frequently do much more than repay it to a great society .

The proper performance o f those several duties o f the sove

reign necessarily supposes a certain expense ; and this expense
again necessarily requires a certain revenue to support it In .

the follo wing book therefore I shall endeavour to exp lain first
, , , ,

what are the necessary expenses o f the sovereign o common r

wealth ; and which o f those expenses ought to be defrayed by

the general contribution o f the whole society ; and which f o

them by that o f so me particular part only o r o f some parti

,

c ular members o f the society ; secondly what are the di

,
fferent
methods in which the whole society may be made to contribute
towards defr aying the expenses incumbent on the whole society ,

a n d what are the principal advantages and i nconveniences o f

e ach o f those methods ; an d thirdly what are the reasons and
,

causes which have induced almost all modern governments to

mortgage some part o f this revenue o r to contract debts and
, ,

what have been the e ffects of those debts upon the real wealth ,

the annual produce o f the land and labour of the society The .

following book the refore will naturally be divided into three

, ,

chapters .
 BOOK V
OF TH E R E VE N U E O F TH E S O VE R E I GN OR
C O MMO N W E AL TH
CHAPTER I
OF THE E X P E N SES OF THE S OVE REI G N OR C O MM O N WE ALT H
PA RT I

0} the E xpens e o f D e f en c e

THE first duty f the sovereign that of protecting the so c iety

o ,

from the violence and invasion of other independent societies ,

can be performed only by means of a military force But the .

expense both f preparingthis military force in time of peace

o ,

and o f employing it in time of w is very different in the ar,

differ nt states of society in the di fferent periods of i mprovement

e ,
.

Among nations of hunters the lowest and rudest state f ,

o

society such as we find it among the native tribes o f N orth

,

America every man is a warrior as well as a hunter When he

,
.

goes to war either to defend his society

,
to revenge the ,
or

injuries whi c h have been done to it by other so ieties he main c ,

tains himself by his w labour in the same manner as when

o n

he lives at home His society for in this state o f things there is

.
,

properly neither sovereign ommonwealth is at no sort o f

nor c ,

expense either to prepare him for the field

,
to mai tain him ,
or n

while he is in it .

Among nations o f shepherds a more advan c ed state of so iety ,

c ,

such as w find it among the Tartars and Arabs every man is

e , ,

in the same manner a warrior Su h nations have commonly

,
. c

no fixed habitation but live either in tents o in a sort of

,
r

covered waggons whi h are easily transported from place t

c o

pl a e The whole tribe or nation hanges its situation acc ord

c . c

ing to the different seasons of the year as well as according t o ,

other accidents When its herds and flocks have consumed the
.

forage o f o e part f the country it removes to nother d

n o ,
a ,
an

from that to a third In the dry season it comes down to the

.

banks o f the rivers ; in the wet season i t retires to the upper

1 82
 T h e Ex p e n s e s of t he S o v e r e ig n 1 83
country When such a nation goes t o war the warriors will n o t
.
,

trust their herds and flocks t the feeble defence f their o ld o o

men their women and children ; and their ld men their women
,
o ,

and children will not be left behind without defen e and withou t
,
c

subsistence The whole nation besides being ac ustomed t o

.
, ,
c

a wandering l ife even in time f peace easily takes the fiel d

,
o ,

in time f w Wh ether it marches as an army moves abou t

o ar .
,
or

as a company o f herdsmen the w a y f life i nearly the same ,

o s ,

though the obje t proposed by it be very d ifl e t They allc er n .

go to war together therefore and every e does as well as he , ,

on

can . Among the Tarta rs even the women have been frequently ,

known to engage i battle If the y conquer whatever belo g n .

,
n s

to the hostile tribe is the re ompense f the victory But if c o .

they are vanquis hed all is lost and not o ly their herds and , ,
n

flo ks but their women and childr en become the boo t y of the

c , ,

conqueror Even the greater part o f those who survive t he

.

action are obliged to submit to him for the sake o f immediat e

subs istence The rest are commo ly dissipated and dispersed

. n ,

in the desert .

The ordi ary life the ordi ary exerc ises o f a Tartar or Ar ab
n ,
n ,

prepare him sufficiently for war Run ing wrestling cudgel . n , ,

playi g throwing the javeli drawi g the bow etc are t he

n ,
n, n
,
.
,

common pastimes o f those who live i the open air and are all n ,

o f them the images of w When a Tartar Arab actually ar . or

goes to w he is maintained by his o w herds an d flock s whi h

a r, n c

he carries with him in the same man ner as in peace His hief . c

o r sovereign fo those nations have all hiefs sovereigns i

,
r c or ,
s

at no sort o f expense in preparin g him fo the field ; d when r an

he is in it the chance o f plunder is the only pay whi h he either c

expects or requires .

A 1 army f hunters can seldom exceed two or t hree hund ed

1 o r

men The precarious subsisten e whi c h the chas e affords could

. c

seldom allow a greater number to keep together for an y con

si d e b l time
ra An army o f shepherds on the contrary may
e .
, ,

sometimes amount to two or thr ee hundred thousand A S long .

as nothing stops their progress as long as they can go from , on

one d istri t f whi h they have consumed the forage to another

c ,
o c ,

whi h i yet ent ir e there seems to b e s carce an y limit to the

c s ,

number who c a march o together A nation o f hunters n n . can

never be formidable to the civilised nations in their neighb our

hood A nation o f shepherds may N o t hing can be more c
. . on

b le than an India w ar i
t emp t i n N ort h Am erica N othing on n .
,

the contr ary can be more dreadful t han a Tart ar inv ion has
, as
 1 84 T he W eal t h of N at i o n s
f requently been in Asia The judgment f Thucydides that . o ,

both Europe an d Asia could not resist the Scythians united has ,

b een verified by the experience o f all ages The inhabitants o f .

t h e extensive but defenceless plains o f Scythia o Tartary have r

been frequently united under the dominion of the chief o f some

«conquering horde or clan and the havoc and devastation of ,

A sia have always signalised their union The inhabitants o f .

the inhospitable deserts o f Arabia the other great nation o f ,

s hepherds have never been united but once ; under Mahomet

,

an d his immediate successors Their union which was more the .

,

e ffect f religious enthusiasm than o f conquest was signalised in

o ,

the same manner If the hunting nations o f America should .

e ver become shepherds their neighbourhood would be much ,

m ore dangerous t o the European colonies than it is at present .

In a yet more advanced state f society among those nations o ,

o f husband men w h have little foreign commerce and no other

o ,

m anufa tures but those coarse and household ones which almost
c

e very private family prepares fo its o w use every man in the r n , ,

same manner either is a warrior o easily becomes such They

,
r .

w h o live by agriculture generally pass the whole day in the Open

air exposed to all the inclemencies of the seasons The hardiness
,
.

Of their ordinary life prepares them for the fatigues Of w ar to ,

s ome of which their necessary occupations bear a gr eat analogy .

The necessary occupation o f a ditcher prepares him to work in

the trenches and t fortify a camp as well as to enclose a field
,
o .

The ordinary pastimes o f such husbandmen are the same as

those of shepherds and are in the same manner the images Of ,

w ar But as husbandmen have less leisure than shepherds

they are not so frequently e mployed in those pastimes They
.
,

are soldiers but soldiers not quite so much masters o f their

,

exercise Such as they are ho we er it seldom costs the sovereign

.
,
v ,

o »
commonwealth any expense to prepare them for the field
r .

A griculture even in its rudest and l owest state supposes a

, ,

s ettlement : some sort o f fixed habitation which cannot be

abandoned without great loss When a nation o f mere husband .

men therefore goes t o w ar the whole people cannot take the

, , ,

field together The old men the women and children at least
.
, , ,

m ust remain at home to take care Of the habitation All the men .

O f the military age however may take the field and i n small
-

, , , ,

n ations o f this kind have frequently done s o In every nation , .

the men o f the military age are supposed t o amount to about a

fourth o r a fifth part o f the whole body o f the people If the .

c ampaign t o o should begin after see d t ime and e d before

, ,
-

,
n
 The Ex p e n s e s of t h e S o v e r ei g n
harvest both the husbandman and his principal labourers can
,

be spared from the farm without much loss He trusts that the .

work which must be done in the meantime can be well enough

executed by the o ld men the women and the ch ildren He is
, ,
.

not unwilling therefore to serve without pay during a short

, ,

campaign and it fre quently costs the sovereign o common

,
r

wealth as little to maintain him i the field as to prepare him n

for it The citizens o f all the different states of ancient Greece

.

seem to have served in this manner till after the second Persian
war ; and the people of Peloponnesus till after the Peloponnesian
war The Peloponnesians Thucydides observes generally left
.
, ,

the field in the summer and returned home to reap the harvest
,
.

The Roman people under their kings and dur ing the first ages Of ,

the republic served in the same manner It was not till t he

,
.

siege o f Veii that they who stayed at home began to contribute

something towards maintaining those w ho went to w r In t he a .

European monarchies which were founded upon the ruins f

,
o

the Roman empire both before and for some time after the
,

establishment o f what is properly called the feudal law the ,

great lords with all their immediate dependants used to serve

, ,

the crown at their o w expense In the field in the same

n .
,

manner as at home they maintained themselves by their o w

,
n

reven ue and n o t by any stipend or pay which they received

,

from the king upon that particular occasion .

In a more advanced state f society t w different causes o ,

o

contribute to render it altogether i mpossible that they who take

the field should maintain themselves at their o w expense n .

Those two causes are the progress o f manufactures and the

, ,

i mprovement in the art o f war .

Though a husbandman should be employed in an expeditio n,

provided it begins after seed time and ends before harvest the -

interruption f his business will not always occasion any con

o

si d
er a b le diminution o f his revenue Without the intervention .

of his labour nature does herself the greater part o f the work
,

which remains to be done But the moment that an t ifi e . ar c r,

a smith a carpenter or a weaver for example quits his work

, , , ,

house the sole source o f his revenue is completely dried up

, .

N ature does nothing for him he does all for himself When , .

he takes the field therefore in defence of the public as he has

, , ,

no revenue to maintain himself he must necessarily be main ,

t ain ed by the public But i a country o f which a gre at part

. n

o f the i n habitants are a rt i

fic ers and manufacturers a great part ,
o f the people who t war must be drawn from those cl sses
go o a ,
11 G
1 86 Th e W eal t h of N at i o n s
and must therefore be maintained by the public as long as they
are employed in its service .

When the art o f war t o o has gradually grown up to be a very

, ,

intri ate and complicated science when the event Of war ceases
c ,

to be determined as in the first ages of society by a single

, ,

irregular skirmish o battle but when the contest is generally

r ,

spun o ut through several different ampaigns each of which c ,

lasts during the greater part o f the year it becomes universally ,

ne c essary that the public should maintain those w ho se rve the

public in w a r at least while they are employed in that se vice
,
r .

Whatever in time of peace might be the ordinary occupation of

those wh go to war so very tedious and expensive a service
o ,

would otherwise be by far t o o heavy a burden upon them .

Af ter the second Persian war accordingly the armies of Athens , ,

seem to have been generally composed of mercenary troops ,

consisting indeed partly of citizens but partly too Of foreigners

, , , ,

and all o f them equally hired and paid at the expense o f the
state From the time o f the siege of Veii the armies o f
.
,

Rome received pay for their service during the time which they
remained in the field Under the feudal governments the.

military service both o f the great lords and of their immediate

dependants w as after a certain period universally exchanged
, ,

for a payment in money which was employed to maintain those

,

who served in their stead .

The number Of those who can go to war in proportion to the ,

whole number of the people is necessarily much smaller in a ,

civilised than in a rude state of society In a civilised society .

,

as the soldiers are maintained altogether by the labour o f those

w ho are not soldiers the number o f the former can never exceed
,

what the latter can maintain over and above maintaining in , ,

a manner suitable to their respective stations both themselves ,

and the other O fficers f government and law whom they are
o

obliged to maintain In the little agrarian states o f ancient

.

Greece a fourth or a fifth part of the whole body of the people

,

considered themselves as soldiers and would sometimes it is , ,

said take the field Among the civilised nations o f modern

,
.

Europe it is commonly computed that not more than o e

,
n

hundredth part of the inhabitants o f any country can be em

ployed as soldiers without ruin to the country which pays the
exp ense Of their s e rvice .

The expense o f preparing the army for the field seems n o t to

have become considerable in any nation till long after that o f
maintaining i t in the field had devolved entirely upon the
 Th e Ex p en s e s o f t h e S o v ere i g n 18
7
s overeign o commonwealth In all the d ifie e t republics Of
r . r n

a ncient Gree e to learn hi milita ry exercises was a necessary

c ,
s

p art o f education imposed by the state upon every free citizen .

In every ity there seems to have been a publi field i which

c c ,
n ,

u nder the prote tion o f the publi c magistrate the young people
c ,

were taught their different exer ises by different masters In c .

t his very simple in stitution consisted the whole expense which

a y Grecian sta te seems ever to have been at i
n n preparing its

c itizens fo w In ancient Rome the exer ises f the Campus

r ar . c o

Martius answered the same purpose with those Of the Gym

n as i um in ancient Gree e Under the feudal governm ents the
c .
,

m any public ordinan es that the itizens of every distri t should

c c c

practise archery as well as several other mi litary exer ises were c

intended for promotin g the same pu pose but do not seem to r ,

have promoted it so well Either from want of interest in the .

o ff ers entrusted with the exe ution

ic f those ordinances or c o ,

from some other cause they appear to have been universally ,

n egle ted ; and in the progress Of ll those governments m ilitary

c a ,

e xercises seem to have gone gradually into disuse among the

g re a t body Of the people .

I n the republi s of ancient Greece and Rome during the whole

c ,

p eriod o f their existen c e and under the feudal governments fo r ,

a considerable tim e after their first establishm ent the trade o f a ,

s oldier w as o t a separate distinct trade whi h con ti t uted the

n , ,
c s

s ole o principal occupation f a particular cl as s of citizens

r o .

Every subje t f the state whatever might be the ordinary

c o ,

trade o o c cupation by whi h he gained his livelihood considered

r c ,

hi mself upon all ordinary o cas ions as fit likewise t exercise

,
c ,
o

the trade Of a soldier and upon many extraordinary occasions ,

a s bo und to exercise it .

The art f w however as it is certainly the noblest o f all

o ar , ,

rts
a ,
in the progress o f improvement it necessarily be omes
so c

o e o f the most complicated among them

n The state o f the .

mechanical as well as o f some other arts with which it is

, ,

ecessarily onne ted determines the degree o f perfection to

n c c ,

which it is capable of being rried at any particular time But ca .

in order to car ry it to this degree o f perfection it is necessary ,

that it should be ome the sole o principal o cupation of a

c r c

particul ar las s o f citizens and the division of labour is as

c ,

necessary fo the improvement o f this as o f every other art Int o

r ,
.

o ther arts the division Of labour is natu rally introduced by t he

prudence of i dividuals w ho find that they promote their private

n ,

in terest be t t er by confinin g themselves to a particular trade

 1—88 Th e W eal t h of N a t i o n s
than by exercising a great nu mber But it is the wisdom of t h . e

state only whi h render the trade of a soldier a particula

c c an r

trade separate and distinc t from all others A private itizen . c

who in time f profound pea e and without any parti c ula

,
o c , r

en ouragement from the publi should S pend the greater part

c c,

of his time in military exercises might no doubt both improv , , , e

himself very mu h in them and amuse himself very well ; but

c ,
“

he ertainly would not promote his own interest It is t he

c .

wisdom f the state only which can render it for his interest
o

to give up the greater part Of his time to this pe uliar o upation c cc

and states have not always had this wisdom even when thei , r

circumstan es had be c ome su h that the preservation of thei r

c c

existence required that they should have it .

A shepherd has a great deal o f leisure ; a husbandman in t he ,

rude state of husbandry has some ; an a t ific or manufacture,

r er r

has none at all The first may without any loss employ
.
, ,
a
'

great deal f his tim e in martial exer ises ; the se ond m y

o c c a

employ some part o f it ; but the last cannot employ a singl e

hour in them without some loss and his attention to his own ,

interest naturally leads him to neglect them altogether Thes e .

'

improvements in husbandry too which the progress o f arts d ,

an

manufa tures necessarily introduces leave the husbandman as

c ,

little leisure as the a t ific e Military exerc ises ome to be a

r r . c s

mu h negle c ted by the inhabitants of the country as by thos e

c

o f the town and the great body of the people becomes altogethe r
'

unwarlike That wealth at the same time which always

.
, ,

follows the improvements of agriculture and manufactures an d ,

which in reality is no more than the accumulated produce o f

those improvements provokes the invasion of all their neigh
,

bours An industrious and upon that account a wealthy

.
,

nation is of all nations the most likely to be atta ked ; and

,
c

unless the state takes some new measures for the public defence ,

the natural habits o f the people render them altogether incapabl e '

o f defending themselves .

In these circumstances there seem to be but two methods

by whi h the state can make any tolerable provision fo t he
c r

public defence .

It may either first by means o f a very rigorous police d

, , ,
an

in S pite of the whole bent of the interest genius and in lination , ,

c s

Of the people enforce the practice o f military exercises

,
d ,
an

Oblige either all the citizens Of the milita ry age a ce tain ‘

,
or r

number o f them to join in some measure the trade of a soldier t o

,

whatever other trade or profession they may happen to carry o n :

 Th e Ex p e n s es o f t h e S o v e r e ig n 1 89
O r secondly by mainta ining and employing a c ertain number
, ,

Ofcitize s in the constant pra ti c e o f military exercises it may

n c ,

render the trade Of a soldier a particular trade separate and ,

d istinct from all others .

If the state has recourse to the first of those two expedients ,

its milita ry force is said to consist in a militia ; if to the second ,

it is said to consist in a standing army The practice f military . o

ie i s the sole r principal occupation f the sol d iers o f a

'

ex e rc s s o o

s tandin g army and the maintenance o pay which the state

,
r

a ffords them the principal and ordinary fund of their sub

is

s istence The pract e f military exer ises is only the oc c a

. ic o c

s io l occupation o f the soldiers f a militia and they derive

na o

the principal and ord inary fund o f their subs i

,

stence from some

o ther o cupation c In a militia the hara ter f the labourer
.
,
c c o ,

a rt i fic e o tradesman predominates over that f the soldier ;

r, r ,
o

in a standing army that of the soldier predominates over every ,

o ther character and in this distin tion seems to consist the

: c

e ssential di ff erence between those two different species o f

milita ry for e c .

Militias have been of several diff erent kinds In some ountries . c

t he citizens destined f defending the sta te seem to have been or

e xercised only without being if I may say so regimented that

, , ,

is without being divided into separate and distin t bodies f

,
c o

troops eac h o f which perform ed its exer ises under its o wn

,
c

prope r and permanent offi ers In the republics o f ancient c .

Greece and Ro me eac h citizen as long as he remain ed at home

, , ,

seems to have pra tised hi exer ises either separately and c s c

independently or with such of his equals as he liked best and

, ,

n o t to have been attached to any particular body f troops o

till he w as a tually called upon to take the field In other

c .

c o u t ri t he m ilitia has not only been exercised but regimented

'

n es , .
,

In England in Switzerland and I believe in every other

, , , ,

country f modern Europe where any imperfect milita ry force

o

of this kind has been established every militiaman is even in , ,

time f peac e atta c hed to a parti ular body o f troops whi h

o ,
c ,
c

p erforms its exer ises under its w proper a d permanent

c o n n

O fficers .

Before the invention of firearms that army w a superior in ,

s

which the soldiers had each individually the greatest skill and , ,

dexterity the use of their arms Strength and agility f body

in . O

w ere o f the highest consequence and co mmonly determined the ,

s tate o f battles But this skill and dexterity i the use f their
. n o

,arms could be a quired only i the same manner as fencing i

c ,
n s
190 T he W eal t h of N a t i o n s
at present by practising not in great bodies but each man
, , ,

separately in a parti c ular school under a particular master

, , ,

or with his own particular equals and companions Since the .

invention o f firearms strength and agility Of body even

, ,
or

extraordinary dexterity and skill in the use o f arms though ,

they are far from being Of n o consequence are however o f less , , ,

consequence The nature of the weapon though it by no mean s

.
,

puts the awkward upon a level with the skilful puts him more ,

nearly so than he ever was before All the dexterity and skill .
,

it is supposed which are necessary for usin g it can be well

, ,

enough acquired by practising in great bodies .

Regularity order and prompt Obedience to command are

, ,

qualities which in mode rn armies are o f more importance

, ,

towards determining the fate Of battles than the dexterity and

skill o f the soldiers in the use f their arms But the noise o f o .

firearms the smoke and the invisible death to which every

, ,

man feels himself eve y moment exposed as soon as he c ome r s

within cannon shot and frequently a long time before the battle
-

can be well said to be e ngaged must render it very difficult to ,

maintain any considerabl e degree f this regularity order and O , ,

prompt obedience even in the begin ing f a modern battle

,
n O .

In an ancient battle there was no noise but what arose from t he

human voice ; there was no smoke there w no invisible cause ,
as

o f wounds o death Every man till some mortal weapon

r .
,

a c tually did approach him saw clearly that no such weapon was ,

near him In these circumstances and among troops wh had

.
,
o

some confidence in their own skill and dexterity in the use f o

their arms it must have b een a good deal less difficult to

,

preserve so me degree f regularity and order not only i the o ,

n

beginning but through the whole progress of an anc ent battle

,
i ,

and till o e Of the two armies w fairly defeated But the

n as .

habits of regularity order and prompt Obedience to command

, ,

can be acquired only by troops which are exer ised in great c

bodies .

A militia however in whatever manner it may be either

, ,

disciplined exercised must always be much inferior to a

or ,

well disciplined and well exercised standing army

- -

The soldiers who are exercised only on e a week o r once a c ,

month can never be so expert in the use of their arms as those

,

w h o are exercised every day or eve ry other day ; and though ,

this circu mstance may o t be o f so much consequence in modern n

as it wa in ancient times yet the acknowledged superiority of

s ,

the Prussian troops ow in g it is said very much to their superior

, , ,
 Th e Ex p en s e s o f t h e S o v ere ig n 1
9 1

exp ertness in their exercise may satisfy us that it is even at this

, ,

day o f ve ry considerable consequence

,
.

The soldiers who are bound to obey their officer only once a
week or once a month and who are at all other times at liberty
,

to manage their o w affairs their o w w y without bei g in any

n n a ,
n

respect accountable to him can never be under the same aw e ,

in his presence can never have the same disposition to ready

,

obedience with those whose whole life and conduct are every
,

day directed by him and w ho eve ry day even rise and go to

,

bed or at least retire to their quarters accordin g to his orders

, , .

In what is ca lled discipline in the habit o f ready Obedience ,

or ,

a m ilitia must always be still more inferior to a standing army

than it may sometimes be in what is called the manual exercise ,

o r in the management and use o f its arms But in modern w ar .

the habit of ready and instant Obedience is o f much greater

consequence than a considerable superiority in the management
o f arms .

Those militias which like the Tartar r Arab militia go to

,
o ,

war under the same Chieftains whom they are accustomed to

Obey in peace are by far the best In respect for their O fficers .
,

in the habit o f ready Obedience they approach nearest t o ,

standing armies The highland militia when it served under

.
,

its own Chieftains had some advantage o f the same kin d As

, .

the highlanders however were not wandering but stationary

, , ,

shepherds as they had all a fixed habitation and were not in

, , ,

peaceable times accustomed to follow their Chieftain from place

,

to place so in time o f w they were less willi g to follow him

,
ar n

to any considerable distance r to onti ue f any long t ime ,

o c n or

in the field When they had acquired any booty they were
.

eager to return home and his authority was seldom sufficient

,

to detain them In poin t of obedience they were always much

.

inferior to what is reported o f the Tartars and Ar abs As the .

highlanders too from their stationary life S pend less o f their

, ,

tii e in the Open air they were always less accustomed t o military
n ,

exercises and were less expert in the use of their arms than the
,

Tartars and Arabs are said to be .

A militia of any kind it must be Observed however which, , ,

has served for several suc essive campaigns in the field becomes
c ,

in every respect a standing army The soldiers are every day .

exercised in the use Of their arms and being constantly under , ,

the command of their flic er are habituated to the same prompt

O
‘
s,

obedience which takes place in standing armies What they .

were before they took the field is Of little importance They .

 1 9 2 Th e W eal t h of N at i o n s
necessarily become i every respect a standing army after they
n

have passed a few campaigns i it Should the w a in A merica n . r

drag o ut through another campaign the A merican militia may ,

become in every respect a match fo that standing army Of w hich r

the valour appeared in the last w a at least o t inferior t o that

,
r, n

Of the hardiest veterans Of France and Spain .

This distinction being well understood the history o f all ages , ,

it will be found bears testimony to the irresistible superiority

,

which a well regulated standing army has over a militia

-

O ne o f the first standing armies f which w e have any distinct o

account in any well authenticated history is that o f Philip o f

,
-

Macedon His frequent wars with the Thracians Illyrians

.
, ,

Thessalians and some o f the Greek cities in the neighbourhood

,

o f Macedon gradually formed his troops which in the beginning

, ,

were probably militia to the exact discipline o f a standing army

, .

When he w a at peace which he w s very seldom and never fo

s ,
a ,
r

any long time together he w careful not t o disband that army ,

as .

It vanquished and subdue d after a long and violent struggle , ,

indeed the gallant and w ll exercised militias o f the principal

,
e -

republics o f anc ent Greece and afterwards with very little

i , ,

struggle the e ffeminate and ill exercised militia o f the great

,

Persian em pire The fall o f the Greek republics and o f the

.

Persian emp re w a the effect f the irresistible superiority which

i s o

a standing army has over every sort o f militia It is the first .

great revolution in the affairs o f m ankind Of which history has

preserved any distinct o r circumstantial account .

The fall Of Carthage and the consequent elevation Of Rome , ,

is the second All the varieties in the fortune Of those t wo

.

famous republics may very well be accounted fo r from the

same cau se .

From the end Of the first to the beginning o f the second

Carthaginian war the armies Of Carthage were continually in
the field and employed under three great generals who suc
, ,

c eed ed one another in the command Amilcar his so n i law : -

n -

A sd rub l and his son A nnibal ; first in chastising their o wn

a ,

rebellious slaves afterwards in subduing the revolted nations o f

,

Africa and lastly in conquering the great kingdom o f Spain

, , , .

The army which An nibal led from Spain into Italy must meces
sa i rly i those di fferent wars have been gradually formed t o
,
n ,

the exact discipline o f a standing army The Romans i the .

,
n

meantime though they had not been altogether at peace yet ,

they had liot during this period been engaged in any w r of

,

a
, ,

very great consequence and their military discipline it is , ,

 Th e Ex p en s e s of t he S o v er eig n 193

generally said was a good deal relaxed The Roman armies

,
.

which An nibal encountered at Trebia Thra yme u and Ca nn ze ,

s n s,

were militia Opposed to a sta nding army This circumstance .

,

it is probable contributed more than any other t o determin e

,

the fate of those battles .

The standing a rmy which Annibal left behind him in Spain

had the like superiority over the militia which the Romans sent
to oppos e it and in a few years under the command o f his
, ,

brother the younger Asd rub al expelled them almost entirely

, ,

from that count ry .

Annibal was ill supplied from home The Roman militia .

,

b eing continually in the field became in the progress o f the war ,

a well disciplined and well exercised standing army and the

- -

superiority o f Annibal grew every day less and less A s d rub al .

j udged i t necessary to l ead the whole o r almost the whole of ,

the sta nding army which he commanded in Spa in to the as sist ,

ance of his brother in It aly In this march he is said to have .

been misled by his guides and in a country which he did not ,

know was surprised and attacked by another standing army

, ,

in every respect equal or superior to his o w and was entirely n,

defeated .

When A sdrub al had left Spain the great Scipio found nothing ,

to Oppose him but a militia inferior to his o w He conquered n .

and subd ued that militia and in the course of the war his w
, , ,
o n

militia necessarily beca me a well dis c ipl ined and well exercised - -

standing army That sta nding army w as after wards ca rried to

.

Africa where it found nothing but a militia to Oppose it In

,
.

order to defend Carthage it became necessary to reca ll the

standing army Of Annibal The disheartened and frequently .

defeated African militia joined it and at the battle of Z ama , , ,

composed the greater part Of t he troops o f An nibal The event .

o f that day dete m ined the fate of the two rival republics
r .

From the end of the second Carthaginian w ar till the fall o f

the Rom n republic the armies o f Rome were in every respect
a ,

standi g armies The standing army Of Macedon made some

n .

resistance t o their arms In the height Of their grandeur it

.

cost them t w o great wars and three great battles t o subdue

, ,

t hat little ki ngdom f which the conquest would probably

,
o

ha ve been still more diffi ult had it not been for the cowardi e
c c :

o f its last king The militias of all the civ ilised natio s of the
. n

ancient world of Greece of Syria and Of E gyp t made but a

, , , ,

feeble resistance to the standin armies of Rome The m ilitias g .

o f some barbarous natio n s defended themselves much be t ter .

11 02
1
94 Th e W e al t h of N a t i o n s
The Scythian r Tartar militia which Mithridates drew from
o ,

the countries north o f the Euxine and Caspian seas were the ,

most formidable enemies whom the Romans had to encounter

after the second Carthaginian w a The Parthian and German r .

militias t o o were always respectable and upon several occasions

, , ,

gained very considerable advantages over the Roman armies .

In general however and when the Roman armies were well

, ,

comm anded they appear to have been very much superior ;

,

and if the Romans did not pursue the final conquest either o f
P arthia o Germany it w as probably because they judged that
r ,

it was not worth while to add those two barbarous countries to

an empire whi c h was alread y too large The ancient Parthians .

appear to have been a nation of S c ythian o Tartar ex t raction r ,

and to have always retained a good deal Of the manners of their

ancestors The an ient Germans were like the Scythi ns o
. c ,
a r

Tartars a nation of wandering hepherds w ho went to w ar

,
S ,

under the same hiefs whom they were a customed to follow in

c c

peace Their militia was exactly f the same kind with that o f
. o

the S ythians or T t a f f o m whom too they were probably

'

c ar rs r , ,

descended .

Many d ifl e e t causes contributed to relax the discipline o f

r n

the Roman armies Its extreme severity was perhaps o e o f

.
, ,
n

those causes In the days o f their grandeur when no enemy

.
,

appeared apable of Opposing them their heavy armour w as

c ,

laid aside as unnecessarily burdensome their laborious exercises ,

were neglected as unne essarily toilsome Under the Roman c .

emperors besides the sta nding armies o fRome those parti c ularly
, , ,

which guarded the German a d Pannonian frontiers became n ,

dangerous to their masters against whom they used frequently ,

t o set up their o w generals In order to render them less

n .

formidable a ording to some authors Dio c le ia according

,
cc ,
s n,

to others Constantine first withdrew them from the frontier

, , ,

where they had always before been en amped in great bodies c ,

generally f two o three legions each and dispersed them in

o r ,

small bodies through the different provin ial towns from when c e c ,

they were scarce ever removed but when it became necessary

to repel an invasion Small bodies o f soldiers quartered in .

trading and manufacturing towns and seldom removed from ,

t hose quarters became themselves tradesmen a t i

,
fic ers and ,
r ,

manufacturers The civil came to predominate over the military

.

c haracter and the standing armies o f Rome gradually de

,

generated into a corrupt neglected and undisciplined militia , , ,

incapable o f resisting the attack o f the German and Scythian

 T he Ex p en s e s of t h e S o v e re ig n 1
95
militias whi h soon afte wards invaded the western empire
,
c r .

It was only by hiring the militia f some of those nations to o

O ppose to that o f others that the emperors were for some t i rn e

a ble to defend themselves The fall of the western emp ire S

. I

the third great revolution in the affairs of mankind o f which

a ncient hi story has preserved any distin t or irc umsta ntial c c

a c ount It was brought about by the irresistible superiority

c .

which the militia o f a barbarous has over that o f a civilised

nation ; whih the militia f a nation o f shepherds has over
c o

that f a nation of husbandmen a t ific e and manufacturers

o r rs,

The victories which have been gained by rri

.
,

i
lit i have general y
l as

been not over sta ndi g arm ies but over other militias in
,
n ,

exerc ise and discipl ine inferior to themselves Such were the .

victories which the Greek militia gained over that of the Persian
empire ; and such too were those which in later times the Swiss
militia gained over that o f the Austrians and Burgundians .

The m ilita ry for e of the German and Scythian nations who

c

e stablished themselves upon the ruins o f the western empire

continued for some time to be o f the same kind in their new

settlements as it had been in their original country It was a .

militia f shepherds and husbandmen which in time o f w ar

o , , ,

took the field under the command f the same Chieftains whom o

it w as accustomed to obey in peace It w as therefore tolerably .

, ,

well exercised and tolerably well disciplined As arts and

,
.

industry advanced however the authority of the hieft ain s

, ,
C

gradually decayed and the great body o f the people had less
,

time t spare fo m ilita ry exerc ises Both the dis ipline and
o r . c

the exerc ise o f the feudal militia therefore went gradually , ,

to ruin and sta nding armies were gradually introdu ed to

,
c

supply the place Of it Wh en the expedient o f a standing army

.
,

besides had once been adopted by one civilised nation it became

, ,

necessary that all its neighbours should follow the example .

They soon found that their safety depended upon their doin g so ,

and that their o w militia w as altogether in apable Of resisting

n c

the atta k of such an army

c .

The soldiers f a sta ndi g army though they may never

o n ,

have seen an enemy yet have frequently appeared to possess all

,

the ourage o f veteran troops and the very moment that they
c ,

took the field to have been fit to fa e the hardiest and most c

experienced veterans In 75 6 when the Russian a myma c hed

. 1 ,
r r

into Poland the valour f the Russian soldiers did not appear
f

, o

inferior t o that o f the P ussians at that time supposed to be the

r ,

hardiest and most experienced veterans in Europe The Russian .

 1
9 6 Th e W e al t h o f N at i o n s
empire however had enjoyed a profound peace for near twenty
, ,

years before and could at that time have very few soldiers who
,

had ever seen an enemy When the Spanish war broke out in .

1 739 England had enj oyed a profound peace for about eight
,

and twenty years The valour o f her soldiers however far

-

.
, ,

from being corrupted by that long peace w as never more ,

distinguished than in the attempt upon Carthagena the first ,

unfortunate exploit o f that unfortunate war In a long peac e . ,

the generals perhaps may sometimes forget their skill ; but

, , ,

where a well regulated sta nding army has been kept up the
-

soldiers seem never to forget their valour .

When a civilised nation depends fo its defence upon a militia r ,

it is at all times exposed to be conquered by any barbarou s

nation whi h happens to be in its neighbourhood The frequent
c

conquests of all the civilised countries in Asia by the Tartars

sufficiently demonstrates the natural superiority which t he
militia o f a barbarous has over that o f a civilised nation A .

well regulated standing army is superior to every militia Such

-

an army as it can best be maintained by an opulent and

,
'
‘

civilised nation so it can alone defend such a nation against t he

,

invasion f a poor and barbarous neighbour It is only by

o .

means of a standing army therefore that the civilisation o f , ,

any country an be perpetuated o r even preserved fo r any

c ,

considerable time .

As it is only by means of a well regulated stand ing army -

that a civilised country can be defended so it is only by means ,

o f it that a barbarous country can be suddenly and tolerably

civilised A standing army establishes with an irresistible

.
‘

force the law Of the sovereign through the remotest provinces

,

o f the empire and maintains some degree o f regular govern ment

,

in countries which ould not othe wise admit of any Whoever c r .

examines with attention the improvements which Peter the

, ,

Great introduced into the Russian empire will find that they ,

almost all resol e themselves into the establishment o f a well

v

regu lated standing army It is the instrument whic h executes .

and maintains all his other regulations That degree o f order .

and internal peace which that empire has ever since enjoyed
is altogether owing to the influence o f that army .

Men o f republican principles have been jealous o f a standing

army as dangerous to liberty It certainly is so wherever t he .

interest o f the general and that o f the prin ipal O fficers are not c

necessarily connected with the support of the constitution o f

the state The standing army o f C esar destroyed the Roman
. a
 The Ex p en ses of th e S o v er e ig n 19
7
republic The sta nding army o f Cromwell turned the Lo g
. n

P arliament o ut f doors But where the sovereign is hims elf

o .

the general and the prin ipal nob ility and gentry o f the c oun t ry
,
c

the chief officers of the army where the military for e is pla ed ,
c c

under the ommand Of those who have the greatest in terest in

c

the support f the ivil authority because they have them

o c ,

selves the greatest share Of that authority a stand ing army can ,

never be dangerous to liberty O the contrary it may in some . n ,

c ases be favourable to liberty The se urity which it gives to . c

the sovereign renders un ecessary that troublesome jealousy n ,

whi h in some modern republi s seems to watch over the

c ,
c ,

m inutest a tions and to be at all t i

c mes ready to disturb the
,

peace of every itizen Where the se urity Of the magistrate

c . c ,

though supported by the prin ipal people f the country is c o ,

endangered by every popular discontent ; where a small tumult

is capable f bringing about in a few hours a great revolution
o ,

the whole authority o f government must be employed to

suppress and punish every murmur and c omplaint against it .

To a sovere ign o the contrary who feels himself supported

,
n , ,

no t only by the natural aristocracy Of the ountry but by a c ,

well regulated standing army the rudest the most groundless

-

, , ,

and the most licentious remo n stran es can give little dis c

t u b an e
r He can safely pardon o neglect them and his con
c . r ,

sc io u s es nOf his o w superiority naturally disposes him to do

s n

so That degree o f liberty which approaches to licentiousness

.

can be tolerated only in ountries where the sovereign is secured c

by a well regulated standing army It is in su h c ountries only

-

. c

that the public safety does not require that the sovereign should
be trusted with any discretionary power for suppressing even
the impertinent wantonness o f this li entious liberty c .

The first duty of the sovereign therefore that of defendin g , ,

the so iety from the violen e and injustice o f other independent

c c

s ocieties grows gradually more and more expe n sive as the

,

s o iety advan es in civilisation

c cThe milita ry for e o f the . c

society which origin ally ost the sovereign no expense either

,
c

in time of peace o r in time of war must in the progress o f , ,

improvement first be mai ta i ed by him i time o f w a and

,
n n n r,

afte wards even in time Of peace

r .

The great hange in t roduced into the art f war by the

c o

i nvention of firearms has enhanced still further both the

e xpen e of exercising and disciplining any parti c ular number
s

o f soldiers in time o f peace and that o f employi g them i n time ,

n

o f wa Both their arms and their ammunition are b ecome

r .
 Th e W e al t h of N a t i o n s
more expensive A musket is a more expensive machine than
.

a javelin or a bow and arrows ; a cannon o r a mortar than a

balista r a catapulta The powder which is spent in a modern
o .

review is lost irre overably and o asions a ve ry considerabl e

c ,
cc

expense The javelins and arrows which were thrown o shot in

. r

an ancient o e could easily be picked up again and were besides

n ,

Of very little value The can on and the mortar are not only
. n

much dearer but much heavier ma hines than the balista or

,
c

catapulta and require a greater expense not o ly to prepare

, ,
n

them fo the field but to carry them to it As the superiority

r ,
.

of the m odern artillery too over that of the an ients is very c

great it has become mu c h more difficult and onsequently

, ,
c

much more expensive to fortify a town so as to resist even fo r

,

a few weeks the attack o f that superior artillery In modern .

times many different causes contribute to render the defence of

the society more expensive The unavoidable effects o f t he .

natural progress of improvement have in this respect been a , ,

good deal enhanced by a great revolution in the art f wa t o O r,

whi h a mere ac ident the invention o f gunpowder seems t o

c c , ,

have given occasion .

In modern w the great expense f firearms gives an eviden t

ar o

advantage to the nation whi h can best afford that expense c ,

and consequently to an Opulent and ivilised over a poor and c

barbarous nation In ancient times the opulent and civ ilise d

.

found it di fficult to defend themselves against the poor d an

barbarous nations In modern times the poor a d barbarou

. n s

find it difficult to defend themselves against the Opulent and

civilised The invention of firearms an invention w hi c h at
.
,

first sight appears to be s perni ious is certainly favourableo c ,

both to the permanency and to the extension of civilisation .

PA R T I I

Of the Expens e o fj us ti
ce

The second duty f the sovereign that o f protecting as far as

o , ,

possible every member of the s ociety from the injustice o r

,

oppression o f every other member f it o the duty of estab o ,

r

lish ig an exact administration o f justi c e requires too

n very , , ,

different degrees o f expense in the different periods of so iety c .

Among nations o f hunters as there is scarce any property ,

or at least none that ex eeds the value o f t w o o three days

c r

labour so there is seldom:any es t ablished magistrate or any

,
 T he Ex p e n s e s of t he S o v e r e ig n 1
99
regular administration of justice Men w ho have no property .

can injure one another o n ly in their persons o r reputation s.

But when one man kills wounds beats or defames another

though he to whom the in jury is done Si
, , , ,

iff rs he who does it e ,

receives no benefit It is otherwise with the injuries to property

. .

The benefit o f the person w ho does the injury is often equal to

the loss o f him who sufiers it Envy malice or resentment .
, ,

are the only passion which can prompt one man to injure
s

an other in his person o r reputa tion But the greater part o f .

men are not very frequently under the influence of those p ssions a ,

and the very worst men are so only occasionally As their .

gratification t o o how agreeable soever it may be to certain

,

characters is not attended with any real o r permanent a dv

,
an

tage it is in the great er part o f men commonly restrained by

,

prudential con siderations Men may live together in society

.

wi t h some tolerable degree o f security though there is no civil ,

magistrate to protect them from the injustice o f those passions .

But avarice and ambition in the rich in the poor the hatred o f ,

lab our and the love f present ease and enjoyment ar e the
o ,

passions whih prompt to invade property passions much more

c ,

steady in their Operation and much more universal in their ,

influence Wherever there 15 great property there is great in

.

equality . Fo one very rich m there must be at least fiv e

r an

hundred poor and the affl uence o f the few su pposes the indigence
,

o f the many The affluence o f the rich excites the indignation

.

o f the poor w ho are often both driven by want and prompted

by envy to invade his possess ions It is only ui

, ,

,
id r the shelter . e

o f the civ i
l magistrate that the o wner of that valuable property ,

which is acquired by the labour o f many years r perhaps o f ,

o

many success ve generations can sleep a s ingle night i security

i ,
n .

He is at all times surrounded by unknow enemies whom though n , ,

he never provoked he never appease and from whose

,
can ,

injustice he can be protected only by the powerful arm o f the

civil magistrate continually held up t o chastise it The acquisi .

tion o f valuable an d exten ive property therefore neces sarily s , ,

requires the establishment o f civil go v m e t Where there er n n .

is no property o at least none that exceeds the value f t w o

,
r o

or three days labour c ivil government is o t so necessary

’
, n .

Civil government supposes a c ertain subordination But as .

the necessity f ivil government gradually grows up w ith the

o c

acquisition o f valuable property so the principal causes whi c h ,

naturally introduce subordination graduall y grow up with the

growth o f that valuable property .
 2 00 T he W eal t h of N a t i o n s
The causes o r circumsta nc es which naturally introduce sub
o rdination o which naturally and antecedent to any civil
,
r ,

i nstitution give some men some superiority over the greater

,

part o f their brethren seem to be four in number ,

.

The first Of those causes o ircumstances is the superiority r c

Of personal qualifications o f strength beauty and agility o f , , ,

body ; of wisdom and virtue f prudence j ustice fortitude ,

o , , ,

and moderation of mind The qualifications o f the body unless .

,

supported by those o f the mind can give little authority in any ,

period o f society He i s a very strong man who by mere

.
, ,

strength o f body c a force two weak ones to Obey him The

,
n .

qualifications o f the mind can alone give very great authority .

They are however invisible qualities ; always dispu t able and

-

, , ,

generally disputed N o so iety whether barbarous . ivilised c ,

or c ,

has ever found it convenient to settle the rules o f precedency o f

rank and subordination according to those invisible qualities ;
but according to something that is more plain and palpable .

The second o f those causes o r circumstances is the superiority

o f age . An Old man p Ov id d his age is not so far ad v anced
,
r e

as t o give suspicion o f dotage is everywhere more respected tha ,

n

a young man o f equal rank fo rtune and abilities Among , ,

.

nations o f hunters such as the native tribes o f N orth A merica

, ,

age is the sole foundation f rank and precedency Among o .

them father is the appellation of a superior ; brother Of an equal ;

, ,

and so n o f an inf erior In the most opulent and civilise d nations

,
.
,

age regulates rank among those who are in every other respec t
equal and among whom therefore there is nothing else to
, , ,

regulate it Among brothe rs and among sisters the eldest

.
,

always take place ; and in the succession o f the paternal estate

eve rything which cannot be divided but must go entire to o ne ,

person su h as a title Of honour is in most cases given to the

,
c ,

eldest Age is a plain and palpable quality which admits of no

.

dispute . I

The third o f those causes o circumstances is the superiority r

o f fortune The authority Of riches however though great in

.
, ,

every age o f society is perhaps greatest in the rudest age o f

,

society which admits o f any considerable inequality o f fortune .

A Tartar chief the increase o f whose herds and stocks is su ffi

,

cient to maintain a thousand men cannot well empl oy that ,

increas e in any other w ay than in maintaining a thousand men .

The rude state o f his society does not afford him any manu
fa c t u red produce any trinkets o baubles of any kind for which
,
r ,

he can exchange that part of his rude produce which is over

 Th e Ex p e n s es of t he S o v ere ig n 2 01

an d above his o w consumption The thousand men whom he

n .

thus mainta ins depending entirely upon him for their subsist
,

ence must both obey his orders in w a and submit to his

,
r,

j urisdiction in peace He is necessarily both their general and

.

their j udge and his chieftainship is the ne essary e ffect o f the

,
c

superiority of his fortune In an opulent and civilised society

.
,

a man may possess a much greater fortune and yet not be able
to command a dozen Of people Though t he produce Of his .

estate may be sufficient to maintain and may perhaps actually ,

mainta in more than a thousand people yet as those people

, ,

pay for eve rything which they get from him as he gives scarce ,

anything to anybody but in exchange for an equivalent there ,

i scarce anybody who considers himself as entirely dependent

s

upon him and his authority extends only over a few menial
,

servants The authority of fortune however is very great

.
, ,

even in an opulent and civilised society That it is mu h greater . c

than that either of age o Of personal qualities has been the r

co stant complaint o f every period f society whi c h admitted

n O

o f any considerable inequality f fortune The first period o f o .

soci ety that o f hunters admits o f no such inequality Uni

, ,
.

versal poverty establishes their universal equality an d the ,

s uperiority either f age o r Of personal qualities are the fee ble

o

but the sole foundations of authority and subordination There .

i s therefore little or no authority o r subordination in this period

o f society The second period f society that o f shepherds
. o , ,

admits o f very g reat inequalities Of fortune and there is no ,

period in which the superiority o f fortune gives so great authority

to those w ho possess it There is no period accordi gly in . n

which authority and subordination are more perfectly estab

lihed
s The authority o f an Ar abian sherif is very great ; that
.

o f a Tartar khan altogether despotical .

The fourth o f those causes or c rcumstances is the superiority i

Of birth Superiority o f birth supposes an ancient superiority

.

Of fortune in the family o f the person who claims it All .

families are equally ancient ; and the ancestors f the prince o ,

though they may be better known cannot well be more numerous ,

than those Of the beggar Antiquity o f family means every .

where the antiquity either O f wealth o r o f that greatness which ,

is commonly either founded upo n wealth or accompanied with ,

it Upstart greatness is eve rywhere less respected than ancient

.

greatness The hatred o f usurpers the love of the family o f an

.
,

ancient monarch are in a great measure founded upo n the

, , ,

contempt which men naturally have fo r the former and upo n ,

202 Th e W eal t h of N at i o n s
the i r veneration for the latter A s a military O fficer submits .

w i thout reluctance to the authority Of a superior by whom he

has always been commanded but cannot bear that his inferior
should be set over his head so men easily submit to a family
,

to whom they and t heir ancestors have always submitted ; but

are fired with indignation when another family in whom they ,

had never acknowledged any such superiority assumes a ,

dominion over them .

The distinction f birth being subsequent t o the inequality

o ,

of fortune can have no place in nations o f hunters among whom

, ,

all men being equal in fortune must likewise be very nearly

, ,

equal in birth The son f a w ise and brave man may indeed
. o , ,

even among them be somewhat more respected than a man o f

,

equal merit who has the misfortune to be the son o f a fool o r

a coward The diff erence however will not be ve ry great ; and
.
, ,

there never was I believe a great family in the world whos e

, ,

illustration was entirely derived from the inheritance o f wisdom

and virtue .

The distinction of birth not only may but always does take ,

place among nations o f shepherds Such nations are always .

strangers to every sort of luxury and great wealth can scarce ,

ever be dissipated among them by improvident profusion .

There are no nations accordingly who abound more in families

revered and honoured o account o f their descent from a long
n

race Of great and illustrious ancestors because there are no ,

nations among whom wealth is likely to continue longer in the

same families .

Birth and fortune are evidently the two circumstances which

principally set one man above another They are the t w great . o

sources Of personal distinction and are therefore the principal ,

causes which naturally establish authority and subordination

among men A mong nations o f shepherds both those causes
.

operate with their full force The great shepherd o herdsman . r ,

respe ct ed on account f his great wealth and f the great

o -

,
o

number of those wh o depend upon him fo r subsistence and ,

revered o account o f the nobleness o f his birth and o f the

n ,

immemorial antiquity o f his illustrious family has a natural ,

authority over all the inferior S hepherds or herdsmen o f his

horde or clan He can command the united force of a greater
.

number of people than any Of them His military power is .

greater than that o f any Of them In time of war they are a ll .

Of them naturally disposed to muster themselves under his

banner rather than under that Of any other person and his
, ,
 The Ex p e n s e s of t h e S o v e r e ig n 20
3
birth and fortune thus naturally procure to him some sort o f
executive power By command ing too the united force o f a
.
, ,

greater number of people than any of them he is best able t o ,

compel any o e Of them who may have injured another to com

n

pensate the wrong He is the person therefore to whom all

.
, ,

those wh0 are too weak to defend themselves naturally look up

fo r protection It is to him that they naturally omplain of the
_

. c

i njuries which they imagine have been done to them and his ,

interposition in such c ases is more easily submitted to even b y ,

the person complained o f than that Of any other p erson woul d

,

be His birth and fortune thus naturally procure him some

.

sort of judi ial authority

c .

It is in the age of shepherds in the second period o f society

, ,

that the inequality o f fortune first begins to take place a d ,

n

introduces among men a degree of authority and subord inatio n

which could not possibly exist before It thereby introduces .

some degree Of that civil government which is indispe nsably

necessary for its o w preservation and it seems to do this
n :

naturally and even independent o f the consideration o f that

,

necessity The consideration o f that necessity comes no doubt

.

afte rwards to contribute very much to maintain and secure that

authority and subordination The rich in particular are ec es
.
, ,
n

sa i
r ly interested to support that order of things which can alon e
secure them in the possession Of their o w advantages Men o f n .

inferior wealth combine to defend those o f superior wealth in

the possession f their property in order that men o f superio
O ,
r

wealth may combine to defend them in the possession o f theirs .

All the inferior shepherds and herdsmen feel that the security
o f their o w herds and flocks depends upon the security f thos e
n O

o f the great shepherd o herdsman ; that the maintenance of

r

their lesser authority depends upon that of his greater authority ,

and that upon their subordination to him depends his power o f

keeping their inferiors in subordin ation to them They con .

st it u t e a sort O f little nobility who feel themselves interested t o

,

defend the property and to support the authority Of their w o n

little sovereign in order that he may be able to defend their

,

property and to suppo rt their authority Civil government so .

,

far as it is instituted for the security of property is in reality in ,

stituted for the defence o f the rich against the poor o f thos e ,
r o

w ho have some property against those w h o have none at all .

The judicial authority o f such a sovereign however far from , ,

b eing a cause o f expense w a for a long time a source of revenu e

,
s

to him The persons who applied to him for justice were

.
2 04 . Th e W eal t h of N a t i o n s i

a lways willing to pay for it and a present never failed to ,

a ccompany a petition After the authority Of the sovereign t o o

.
, ,

w as thoroughly established the p e o f u d guilty over and ,

rs n o n
,

above the satisfaction which he w a s obliged to make to the

p arty w a s likewise forced to pay an amercement to the sove
,

r eign . He had given trouble he had disturbed he had broke , ,

the peace of his lord the king and for those o ffences an amerce ,

m ent was thought due In the Tartar governments f A sia in

. o ,

t h e governments o f Europe which were founded by the German

and Scythian nations who overturned the Roman empire the ,

administration o f justice w a considerable source f revenue as o ,

b oth to the sovereign and to all the lesser chiefs o lords who r

e xercised under him any particular j urisdiction either over ,

some particular tribe or clan or over some particular territo ry ,

o rdistrict O riginally both the sovereign and the inferior hiefs

. c

used to exercise this jurisdi tion in their w persons After c o n .

.

wards they universally found it convenient to delegate it to

s ome substitute baili ff
,
r judge This substitute however was
,
o .
, ,

s till obliged to a count to his prin ipal o

c constituent for the c r

profits o f the jurisdiction Whoever reads the instructions .

1

w hich were given to the judges Of the circuit in the time Of

Henry II will see clearly that those judges were a sort o f
.

i tinerant factors sent round the c ountry for the purpose of

,

levying certain branches o f the king s revenue In those days ’

.

t he administration o f justice not only afforded a certain revenue

t o the sovereign but t o pro c ure this revenue seems t o have been
,

o n e Of the principal advantages which he proposed to obtain by

t he administration Of justice .

This scheme o f making the administration o f justice sub

s ervient to the purposes of revenue could scarce fail to be pro

d uc t iv e of several very gross abuses The person w ho applied .

fo justice with a large present in his hand was likely to get

r

s omething more than justice ; w hi le he wh applied for it with o

a small e w as likely to get something less

on Justice too might .
, ,

f requently be delayed in order that this present might be

repeated The amercement besides Of the person complained
.
, ,

o f might frequently suggest a very strong reason for finding

,

hi m in the wrong even when he had not really been s

,
That o .

s uch abuses were far from being uncommon the ancient histo ry
o f every country in Europe bears witness .

When the sovereign o hief exercised his judicial authority

r c

i his own person how much soever he might abuse it it must

n , ,

Th y t b f d i Ty ll H it y 0/ E gl d
1 ’
e ar e o e o un n rr e s s or n an .
 T he Ex p e n s e s of t he S o v e re ig n 2 05

have been scarce possible to get any redress because there ,

could seldom be anybody powerful enough to call him t o

ac ount When he exer ised it by a bailiff indeed redres s

c . c , ,
.

might sometimes be had If it w s fo his o w benefit only . a r n

that the bailiff had been guilty o f any act o f injusti e t he c ,

sovereign himself might not always be unwilling to punish him ,

or to Oblige him to repair the wrong But if it was for t he .

benefit o f his sovereign if it was in order to make court to t he

,

person w ho appointed him and who might prefer him that he ,

had committed any act o f oppression redress would upon most ,

occasions b e as impossible as if the sovereign had committed

'

it himself In all barbarous governments accordingly in all

.
, ,

those ancient governments o f Europe in parti ular which were c

founded upon the ruins o f the Roman empire the administration ,

of justice appears fo r a long time to have been extremel y

co rrupt far from being quite equal and impartial even under t he
,

best monarchs and altogether p fiiga t e under the worst

,
ro .

Among nations o f shepherds where the sovereign or chief is ,

only the greatest shepherd or herdsman Of the horde or clan he ,

is mainta ined in the same manner as any f his vassals o o r

subjects by the increase of his o wn herds or flocks Among

,
.

those nations o f husbandmen w ho are but just come o u t of the

shepherd state and who are not mu h advanced beyond that
,
c

state such as the Greek tribes appear to have been about t he

,

time f the Trojan w ar and o u German and S ythian an estors

o ,
r c c

when they first settled upon the ruins o f the western e mpire ,

the sovereign r chief is in the same manner only the greates t

o , ,

landlord of the country and is maintained in the same manne r

, ,

as any other landlord by a revenue derived from his o wn ,

private estate o from what in modern Europe was called t he

,
r , ,

demesne of the c rown His subjects upon ordinary occasions

.
, ,

contribute nothing to his support except when in order to p o , ,

r

te t them from the oppression Of some of their fellow subjects

e -

they stand in need f his authority The presents which they

o .

make him upon such o c casions constitute the whole ordinary

revenue the whole f the e moluments which except perhap
,
o ,
s

upon some very extraordinary emergencies he derives from ,

his dominion over the m When Agamemnon in Homer O ffers .

, ,

to Achilles for his friendship the sovereignty o f seven Greek

cities the sole advantage which he mentions as likely to b e
,

derived from it w that the people would honour him with

as

presents As long as such presents as long as the emolument

.
, s

o f justice o what may be called the fees of court constituted

,
r ,
2 06 The W eal t h of N at i o n s
in this manner the whole ordinary revenue whi c h the sovereign
d erived from his sovereignty , it could not well be expe ted it c ,

c ould t even decently be proposed that he should give them

no
,

u p altogether It might and it frequently w s proposed that

.
,
a ,

h should regulate and ascertain them

e But after they had .

b een so regulated and as ertained how to hinder a person w h o c ,

w s all powerful from extending the m beyond those regulations

a -

w s still very di fficult not to say i mpossible

a During the con
, .

t iun anc f this state f things therefore the c orruption Of

e o o , ,

j usti e
c naturally
,
resulting fro m the arbitrary and un ertain c

nature o f those presents s arce admitted o f any e ff ectual ,

c

r e m edy .

But when from different causes c hiefly from the continually ,

i ncreasing expense f defending the nation against the invasion

o

o f other nations the private estate Of the sovereign had become

,

a ltogether insufficient for defraying the expense o f the sove

r eig tny and ,
when it had become ne essary that the people c

should f their o w security contribute towards this expense

,
or n ,

b y taxes o f diff erent kinds it seems to have been very commonly ,

stipulate d that no present fo the administration f justice r o

s hould under any preten c e be accepted either by the sovereign

, , ,

o by his bailiff s and substitutes the judges Those presents it

r ,
.
,

s eems to have been supposed could more easily be abolished ,

a ltogether than e ff e c tually regulated and ascertained Fixed .

s alaries were appointed to the judges whi h were supposed to ,

c

c ompensate to them the loss f whatever might have been their o

share o f the ancient emoluments Of justice as the taxes more ,

t han compensated to the sovereign the loss f his Justice was o .

then said t be administered gratis o .

Justi c e however never was in reality administered gratis in

, ,

a y ountry
n c Lawyers and attorneys at least must always be
.
, ,

paid by the parties ; and if they were not they would perform , ,

t heir duty still worse than they actually perform it The fees .

a nnually paid to lawyers and attorneys amount in every ourt ,

c ,

t o a mu h greater sum than the salaries o f the judges

c The .

c ircumstance o f those salaries being paid by the rown can c

nowhere mu h dim inish the necessary expense o f a law suit

c -

But it w a not so mu h to diminish the expense as to prevent

s c ,

t he corruption o f justice that the judges were prohibited from ,

r e eiving any present r fee from the parties

c o .

The office Of judge is in itself so very honourable that men

a e willing to accept o f it though a c companied with very small
r ,

e moluments The inferior office o f justice o f peace though

.
,
 The Ex p e n s e s of t he S o v ere ig n 20
7
a ttended with a good deal o f trouble and in most cases with ,

n o emoluments at all is an obje t of ambition to the greater ,

c

p art o f u country gentlemen

o r The salaries of all the d fferent
i .

j udges high and low together with the whole expense Of the
, ,

administrat on and exe ution f justi e even where it is not

i c o c ,

managed with very good economy makes in any civilised , ,

c ountry but a very i ,

nconsiderable part o f the whole expense of
government .

The wh ole expense of justice too might easily be defrayed by , ,

the fees o f court ; and without expos ing the admi istration o f ,
n

justice to any real hazard o f corruption the public revenue ,

might thus be entirely dis harged from a certain though per c , ,

haps but a small incumbrance It is d ifficult to regulate the

,
.

fees of court effectually where a person so powerful as the

s overeign is to share in them and to derive any considerable ,

part Of his revenue from them It is very easy where the judge .

is the principal person w ho can reap any benefit from them .

The law can very eas i ly Oblige the judge to respect the regu la
tion though it might not always be able to make the sovereign
,

res pect it Where the fees o f ou rt are precisely regulated and

. c

ascertained where they are paid all at on e at a ertain period

,
c ,
c

O f every process in to the hands f a cashier o re eiver to be

,
o r c ,

by him distributed in certain known proportions among the

d ifferent judges after the process is decided and not till it is ,

d ecided there see m s to be no more danger o f corruption than

,

where su h fees are prohibited altogether Those fees without

c .
,

o ccasioning any considerable in reas e in the expense f a law c o

s uit might be rendered fully su fficient for defraying the whole

,

e xpe se o f justice
n By t being paid to the judges til l the
. no

process w as determined they might be some in itement to the ,

c

d iligence f the ourt in examining and de iding it

o c In courts c .

which consisted o f a considerable number o f judges by propor ,

ti o n i gthe share Of each judge to the number o f hours and days

n

w hich he had employed in exam ini ng the pro ess either in the c ,

c ourt in a committee by order of the c ourt those fees might

or ,

g ive so m e encouragement to the diligen e Of each particular c

j udge Publi
. services are never better
c performed than when
their reward omes only in consequen e f their being performed
c c o ,

a d is proportioned to the diligence employed in performing

n

t hem In the different parliaments Of Fran e the fees o f court

. c ,

( called E p i e and v ti )
c sconstitute the far greater
ac a part o f
ons

t he emoluments f the judges After all deduc tions are made

o .
,

t he net salary paid by the crown to a counsellor o judge in r

2 08 T he W eal t h of N at i o n s
the parliament o f Toulouse in rank and dignity the second ,

parliament of the kingdom amounts only to a hundred and ,

fifty livres about six pounds eleven shillings sterling a year

, .

About seven years ago that sum was in the same pla e the c

ordinary yearly wages o f a ommon footman The distribution c .

o f those E i t is a ording to the diligence f the judges

p c o es , o, cc O .

A diligent judge gains a comfortable though moderate revenue , ,

by his office : an idle o e gets little more than his salary n .

Those parliaments are perhaps in many respects not very con , ,

v e i t courts o f justi e ; but they have never been accused

n en c ,

they seem never even to have been suspected o f corrup ,

tion.

The fees o f court seem originally to have been the principal

support of the different courts of justice in England Each .

court endeavoured to draw to its elf as mu h business as it c

could and w s upon that account willing to take cognisance

,
a , ,

o f many suits whi h were not originally intended to fall unde r

c

its jurisdi c tion The ourt o f king s bench instituted for t he

. c
’
,

trial of criminal auses only took cognisance of civil suits ; t he

c ,

plaintiff pretending that the defendant in not doing him justice , ,

had been guilty f some trespass or misdemeanour The court

o .

Of exchequer instituted for the levying Of the king s revenue

,
’
,

and for enforc i g the payment of such debts only as were d ue

n

to the king took ognisance f all other ontra t debts ; the

,
c o c c

plaintiff alleging that he ould not pay the king because t he c

defendant would t pay him In consequence o f such fictions

no .

it came in many ases to depend altogether upon the parties

,
c ,

before what court they would choose to have their cause tried ; -

and ea h ourt endeavoured, by superior dispatch and im

c c

partiality to draw to itself as many causes as it could The

,
.

present admirable constitution o f the courts o f justi e in Eng c

land was perhaps originally in a great measure formed by this

, ,

emulation which anciently took place between their respective

judges ; each judge endeavourin g to give in his own court the , ,

speediest and most e ffectual remedy which the law would admit
for every sort f injustice O riginally the courts o f law gave
O .

damages only for breach of ontra t The court Of Chan ery c c . c ,

as a ourt o f ons ienc e first took upon it to enforce the S pecific

c c c ,

performance of agreements When the breach o f contract .

'

consisted in the non payment o f money the damage sustained -

could be co mpensated in no other way than by orderin g pay

ment which was equivalent to a pe ific performance o f the
,
S c

agreement In such cases therefore the emedy o f the court s

.
, ,
r
 Th e Ex p en s e s o f t h e So v er e ig n -
2 09

of law was su fficient It was not so in others When the . .

tenant sued his lord f havi g unjustly outed him f his le ase or n o ,

the dam ages whi h h recovered were by no means equivalent c e

'

to the possession o f the land Su h auses therefore for some . c c , ,

time went all to the ourt f han ery to the no small loss f
,
c o C c ,
o

the ourts f law It was to draw ba k su h causes to them

c o . c c

selves that the ourts o f law are said t o have invented the
c

artifi ial and fictitious w it o f eje tment the most effectual

c r c ,

remedy fo an unjust outer dispossession f land

r or o .

A stamp duty upon the law pro eedi gs f ea h parti ular

-
c n o c c

court to be levied by that court and applied towards the

, ,

maintenan ce of the judges and other Offiers belonging to it c ,

might in the same manner afford a revenue su ff cient for de

, ,
i

fraying the expense o f the administration f justi e w ithout o c ,

bringing any burden upon the general revenue f the society o .

The judges indeed might in this case be under the temptation , ,

Of multiplying unnecessarily the proceedin gs upon every ause c ,

in order to in rease as mu h as possible the produ e Of su h a

c ,
c ,
c c

stamp duty It has been the ustom in modern Europe to

-

. c

regulate upon most o casions the payment o f the attorneys and

,
c ,

clerks o f court a cording to the number o f pages which theyc

had o casion to write ; the court however requiring that ea h

c , ,
c

page should contain so many lin es and ea h line so many ,

c

words In order t o increase their payment the attorneys and

.
,

clerks have ontrived to multiply words beyond all ne essity t o

c c ,

the orru ption o f the law language o f I believe every court o f

c , ,

j ustice in Europe A like temptation might perhaps occasion .

a like corruption in the form Of law pro eedings c .

But whether the admin istration o f justi e be so c ontrived as c

t o defray its w expense whether the judges be main tain ed

o n ,
or

by fixed s laries paid t o them from some other fund it does

a ,

n o t seem necessary that the person persons entrusted with or

the executive power should be charged with the manage ment f o

that fund o with the payment of those salaries That fund

,
r .

m ight arise from the rent f landed esta tes the man agement of o ,

ea h estate being entrusted t the parti ular ourt which w as

c o c c

to be maintain ed by it That fund might arise even from the .

interest f a sum f m oney the lending o ut f whi h might in

o o ,
o c ,

t he same ma ner be entrusted t the court whi h w to be

n ,
o c as

main ta ined by it A part though indeed but a small part f

.
, ,
o

the salary f the judges f the court f session in S otland

o o o c

a rises from the interest f a sum o f money The necessary o .

i nsta bility o f such a fund seems however t o render it an , ,

2 10 T he W eal t h of N a t i o n s
improper n e for the maintenance of an institution which ough t
o

to last for ever .

The separation Of the judicial from the executive power seem s

originally t o have arisen from the in reas ing busin ess o f the c

so ie t y in consequence o f its in reasing im provement The

c ,
c .

administration f j ustice became so laborious and so complicated

O

a duty as to require the undivided attention f the p er so ns t o o

whom it was entrusted The person entrusted with the exec u .

tive power not having leisure to attend t o the decision o f

private causes himself a deputy was appointed to decide them
,

in his stead In the progress f the Roman greatness the consul

. o ,

was t o o mu h occupied with the politi al affairs Of the state

c c

to attend to the administration o f justice A pr tor therefore . a

e , ,

was appointed to administer it in his stead In the progress o f .

the European monar hies which were founded upon the ru ins
c

Of the Roman empire the sovereigns and the great lords cam e
,

universally to consider the administration o f justice as an O ffice

both t o laborious and t o ignoble for them to execute in their
o o

o w n persons They universally therefore discharged them

.
, ,

selves o f it by appo inting a deputy bailiff or judge , ,

.

When the judi c ial is united to the executive power it is scarce ,

possible that justi e should o t frequently be sa rificed to what

c n c

is vulgarly called politics The persons entrusted with the great .

interests Of the state may even without any cor upt views ,
r ,

sometimes i magine it ne essary to sa rifi e to those i terests t hc c c n e

rights o f a private man But upon the impartial admi istration. n

Of justi e depends the liberty of every individual the sense whi h

c ,
c

he has of his own se urity In order to make every individual

c .

feel him self perfe tly se ure in the possession f every right whi h
c c o c

belongs to him it is not only necessary that the judicial should

,

be separated from the exe utive power but that it should b c ,

e

rendered as mu c h as possible independent f that power The o .

judge should not be liable to be removed from his O ffi e ac ord c c

ing to the caprice of that power The regular payment of his .

salary should t depend upon the good will o even upon t he

no -
r

good e onomy o f that power

c .

PA RT III

0/ the Expen se o f P u bli

c Wo rks and P u bli
c I ns t i
t ut i
ons

The third and last duty f the sovereign commonwealth i o or s

tha t o f ere ting and ma ntaining those public in stitutions and

c i

those public works whi h though they may be in the highe t

,
c ,
s
 T h e Ex p en s e s of t h e S o v e r e ig n 2 1 1

degree advantageous to a great society are however f su h , , ,

o c

a nature that the profit could never repay the expense t o any
individual o small nu mber Of individuals and whi h it there
r ,
c

fore can ot be expected that any individual or small number

n

o f individuals should ere t o m ain tain The performance o f

c r .

this duty requires too very different degrees o f expense in the

, ,

di fl e e t periods o f so iety
r n c .

After the public institutions and public works necessary fo r

t he defence of the so c iety and for the a dministration o f justi e

,
c ,

both Of which have already been mentioned the other work ,

s

and institutions Of this kind are chiefly those fo facilitating r

the ommerce o f the socie t y and those fo promoting t h

c ,
r e

ins tru c tion o f the people The institutions for instruction are
.

o f t w o kinds : those for the edu ation o f the youth and thos e c ,

fo the in struction of people o f all ages

r The consideration of .

the mann er in which the expense o f those different sorts o f

public works and in stitutions may be most properly defraye d
will divide this third part o f the present hapter in to thre e c

different articles .

ARTI C LE I
c Wo rks a n d I n s ti
Of the P ubli t u ti
on s fo r f a ci
lita ti
n
g
the C o mmer c e o f the S o c iety

A n d, firs t ,
o f thos e whi
ch a re n ec ess a ry f or f aci
lita ti
n
g
C o mmer ce i
n
gen er a l

That the erection and maintenance o f the public works which

facilitate the commerce o f any country such as good roads , ,

bridges navigable canals harbours etc must require ve y

, , , .
,
r

d ifferent degrees f expense in the different periods o f society

o

is evident without any proof The expense o f makin g and .

maintaining the public roads Of any count y must evidently r

increas e with the annual produce of the land and labour o f that
country o with the quantity and weight f the goods which it
,
r o

becomes necessary to fet h and carry upon those roads The

c .

strength o f a bridge must be suited to the number and weight

o f the carriages which are l i
kely t pass over it The depth and o .

the supply f water for a navigable canal must be proport ioned

o

to the number and tonnage o f the lighters which are likely to

ca rry goods upon it ; the extent of a harbour to the nu mber o f
the shipping which are likely t o ta ke shelter in it .

It does not seem necessary that the expense f those publi c o

 2 12 T he W eal t h of N at i o n s
w orks should be defrayed from that public revenue as it is ,

c ommonly called Of which the collection and application is in

,

m ost countries assigned t o the executive power The greater .

part o f such public works may easily be so managed as to

a fford a particular revenue sufficient fo defraying their o w r n

e xpense without bringing any burden upon the general revenue

,

o f the society .

A highway a bridge a navigable canal fo r example may in

, , , ,

m ost cases be both made and maintained by a small toll upon

the carriages which make use of them a harbour by a moderate : ,

port duty upon the tonnage f the shipping whi c h load o r un

-

l oad i it n The coinage another institution f facilitat ing com

.
,
or

m erce in many countries not only defrays its o w expense

, ,
n ,

b u t aff ords a small revenue seignorage to the sovereign The or .

p ost o ffic e another institution for the same purpose over and
-

, ,

a bove defraying its own expense a ff ords in almost all countries ,

a ve ry considerable revenue to the sovereign .

When the carriages which pass over a highway o r a bridge ,

a d the lighters which sail upon a navigable canal pay toll in

n ,

p roportion to their weight o r their tonnage they pay f the ,

or

m ai ntenance Of those public works exactly i proportion to the n

w ear and tear which they occasion o f them It seems scarce .

possible to invent a more equitable way o f maintainin g such

works This tax r toll too though it is advanced by the
. o ,

c arrier is finally paid by the consumer to whom it must always

, ,

b e charged in the price o f the goods As the expense Of carriage .

,

h owever is very much reduced by means o f su c h public works

, ,

t he goods notwithstanding the toll come cheaper to the con

, ,

s umer than they could otherwise have done ; their pri e not c

being so much raised by the toll as it is lowered by the cheapness

o f the carriage The person who finally pays this tax therefore
.
, ,

g ains by the application more than he loses by the payment o f

i t . His payment is exactly in proportion to his gain It is .

in reality no more than a part Of that gain whi h he is obliged c

to g i ve up in order to get the rest It seems impossible to .

imag ne a more equitable method f raising a tax

i o .

When the toll upon carriages Of luxury upon coaches post , ,

c haises etc is made somewhat higher in proportion to their

,
.
,

weight than upon carriages o f necessary use such as carts , ,

waggons etc the indolence and vanity o f the rich is made to

,
.

c ontribute in a very easy manner to the relief o f the poor by ,

r endering cheaper the transportation of heavy goods to a ll the

d i fferent parts of the country .
 T he Ex p en s e s of t h e S o v er e ig n 2 1
3 :

When high roads bridges canals et are in this man e r

, , ,
c .
,
n

made and supported by the commerce which is rried on by ca

means of them they can be made o l y where that commerce

,
n

requires them and onsequently where it is proper to mak e

,
c

them Their expense t o o their grandeur and magnificence

.
, ,

must be suited to what that o mmer e can afford to pay Theyc c .

must be made onsequently as it is proper to make them A

c .

magnificen t high road cannot be made through a desert country

where there is little or no c o mmerce merely because it ,
or

happens to lead to the country villa of the i tendant o f t he n

provin ce o to that Of some great lord to whom the intendan t

,
r

finds it convenient to make his court A great bridge cannot b e .

thrown over a river at a place where nobody passes o merely ,

r

to embellish the view from the windows of a neighbouring

palace things which sometimes happen in countries where
:

works of th is kind are carried on by any other revenue than that

which they themselves are capable o f aff ordi g n .

In several different parts o f Europe the toll o lo k duty upon r c -

a canal is the property of private persons whose private interes t ,

obliges them to keep up the canal If it is not kept in tolerabl e .

order the navigation necessarily ceases al together and along

, ,

with it the whole profit which they can make by the tolls If .

those tolls were put under the man agement of comm issioners ,

who had themselves no interest in them they m ight be less ,

attentive to the maintenance f the works whi h produce d o c

them The canal o f Languedoc cost the K ing of France d

. an

the provin e upwards o f thirteen mil lions o f livres which (at

c ,

twenty eight livres the mark of silver the value of French ,

money in the end f the l ast centu ry ) amounted to upwards o f

o

nine hundred thousand pounds sterling When that great work .

was fin ished the most likely method it was found o f keeping

, , ,

it in constant repair was to make a present o f the tolls to Riquet

the engineer who planned and conducted the work Thos e
,
.

tolls constitute at present a ve ry large estate t o the different

branches of the family o f that gentleman w h have therefore ,
o , ,

a great interest to keep the work in constant repair But h d . a

those tolls been put under the management Of commissioners ,

wh o had no such interest they might perhaps have been dis si

,

pated in ornamental and unnecessary expenses whil e the mos t ,

essential parts f the work were allowed to go to ru in

o .

The tolls for the maintenance of a high road cannot with y an

safe t y be made the property of private persons A high road .

,

though entirely neglected does not become altogethe r im

,
.
2 14 T he W eal t h of N a t i o n s
p assable though,
a canal does The proprietors o f the tolls .

upon a high road therefore might neglect altogether the repair

, ,

o f the road and yet continue t levy very nearly the same tolls
,
o .

It is proper therefore that the tolls for the maintenance Of such

, ,

a work should be put under the manage ment o f commissioners

o r trustees .

In Great Britain the abuses which the trustees have com ,

mi t t ed in the management o f those tolls have in many c ases

b een very justly complained o f At many turnpikes it has .
,

b een said the money levied is more than double o f what is

,

necessary for executing in the completest manner the work , ,

which is often executed in a very slovenly manner and some ,

times not executed at all The system O f repairing the high .

roads by tolls of this kind it must be observed is not Of very , ,

long standing We should not wonder therefore if it has not

.
, ,

y et been brought to that degree f perfection of which it seems o

c apable If mean and improper persons are frequently appointed

.

t rustees and if proper courts o f inspection and account have

,

no t yet been established for controlling their conduct and fo r ,

reducing the tolls to what is barely sufficient for exe c uting the
w ork to be done by them the recency f the institution both ,
o

accounts and apologises for those defects o f which by the , ,

wisdom Of parliament the greater part may in due time be ,

gradually remedied .

The money levied at the different turnpikes in Great Britain

i s supposed to exceed so much what is necessary for repairing
the roads that the savings which with proper economy might
, , , ,

be made from it have been considered even by some ministers

, , ,

as a very great resource which might at some time o another r

be applied to the exigencies o f the state Government it has .

,

been said by taking the management o f the turnpikes into its

,

ow hands and by employing the soldiers who would work for

n , ,

a very small addition to their pay could keep the roads in good ,

order at a much less expense than it can be done by trustees ,

who have no other workmen to employ but such as derive their

whole subsistence from their wages A great revenue half a .
,

million perhaps it has been pretended might in this manner

,
1
,

be gained without laying any new burden upon the people ;

and the turnpike roads might be made to contribute to the
1
Si p bli h i g t h t w fi t diti
n ce u s nf t hi b k I h v g t g d
e o rs e ons o s oo a e o oo
t b l iv t h t ll t h t pik t ll l vi d i G t B it i d t
,

r eas o n s o e e e a a e urn e o s e e n r ea r a n o no
p d ro t
uc e a v ne th t mre t t h lf mill i ;
en u e m wh i h
a d a o un s o a a on a su c un er
g m t f G v m t w ld t b fli i t t k p i p i
,

th m e an a e en o o ern en ou no e su c en o ee n re ar
f t h p i ip l d i t h ki gd m
,

fi ve o e r nc a ro a s n e n o .
 Th e Ex p e n s es of t h e S o v ere ig n 2 1
5
g eneral expense of the state in the same manner as the post ,

O ffic e does at present .

That a considerable revenue might be gained in this manner

I have no doubt though probably o t near so mu c h as the
,
n

projectors f this plan have supposed The plan itself however

o .
, ,

seems liable to several very important objections .

First if the tolls which are levied at the turnpikes should ever
,

be considered as one o f the resources fo supply ing the exigencies r

O f the st ate
’
they would certa m be augmented as those
,

e xigencies were supposed to require According to the policy .

o f Great Britain therefore they would probably be augmented

, ,

very fast The facility with which a great revenue c ould be

.

drawn from them would probably encourage ad m inistration

to recur very frequently to this resource Though it may .
,

perhaps be more than doubtful whether half a million could by

,

an y economy be saved o u t o f the present tolls it can sca r c e be ,

doubted but that a million might be saved out f them if they o

were doubled ; and perhaps two millions if they were tripled .

1

This great revenue too m ight be levied without the appointment

o f a single new o ffi
, ,

c er to collect and receive it But the t um .

pike tolls being continually augmented i this manner instead n ,

o f facilitating the i nland commerce f the country as at present o ,

would soon become a very great incumbrance upon it The .

expense of transporting all heavy goods from o e part o f the n

c ountry to another would soon be so much increased the market ,

for all su c h goods consequently would soon be so much nar

, ,

rowed that their production would be in a great measure

,

discouraged and the most important branches o f the domestic

,

industry of the country annihilated altogether .

Secondly a tax upon carriages in proportion to their weight

, ,

though a very equal tax when applied to the sole purpo se o f

repairing the roads is a ve y unequal one when applied t o any
,
r

other purpose o to supply the common exigen ies o f the state

,
r c .

When it is applied to the sole purpose above mentioned each ,

carriage is supposed to pay exactly for the wear and tear which
that carriage occasions o f the roads But when it is applied .

to any other purpose each carriage is supposed to pay for more ,

than that wear and tear and contributes t o the supply o f some ,

other exigency o f the state But as the turnpike toll raises the .

price of goods in proportion to their weight and not to their ,

value it is chiefly paid by the consumers Of coarse and bulky

, ,

1
I h v a w g de no t b li v t h t ll t h
oo j t l m
rea so n s o e e e a a ese c o n ec ur a su s ar e
by m h t l g
uc oo ar e .
2 1 6 The W ea l t h of N at i o n s
not b y those o f precious and light commodities Whatever , .

exigen y of the state therefore this tax might be intended to

c

supply that exigen c y would be chiefly supplied at the expense

,

o f the poor not of the rich ; at the expense of those wh o are

,

least able to supply it o t o f those who are most able

,
n .

Thirdly if government should at any time neglect the repara

,

tion of the high roads it would be still more difficult than it is

,

at present to compel the proper application f any part o f o

the turnpike tolls A large revenue might thus be levied upon

.

the people without any part of it being applied to the only

purpose to which a revenue levied in this manner ought ever
to be applied If the meanness and poverty f the trustees Of
. o

turnpike roads render it sometimes difficult at present to oblige :

them to repair their wrong their wealth and greatness would ,

render it ten times more so in the case which is here supposed .

In France the funds destined fo the reparation o f the high

,
r

roads are under the immediate direction of the executive power .

Those funds consist partly in a certain number o f days labou ’

r

which the country people are in most parts o f Europe obliged

to give to the reparation of the highways and partly in such a ,

portion o f the general revenue of the state as the kin g chooses

to spare from his other expenses .

By the ancient l w o f France as well as by that o f most

a ,

other parts of Europe the labour of the count y people w ,

r as

under the direction Of a local or provincial magistracy which ,

had no immediate dependency upon the king s council But ’

.

by the present practice both the labour o f the country people ,

and whatever other fund the king may choose to assign f the or

reparation of the high roads in any particular province o r

gene rality are entirely under the management o f the intendant

,

an officer who is appointed and removed by the kin g s council ’

,

who receives his orders from it and i s i constant corre ,

n

s o n d e c e with it
n In the progress of despotism the authority
p .

o f the executive power gradually absorbs that o f eve y other r

powe r in the state and assumes to itself the management of

,

every branch f revenue which is destined for any public pu rpose

o

In France however the great post —

.

,
roads the roads which make
, ,

the communication between the principal towns f the kingdom o ,

are in general kept in good order and in some provin c es are ,

even a good deal superior to the greater part of the turnpike

roads of England But what We call the cross roads that is
.
-

, ,

the far greater part o f the roads in the country are entirely ,

neglected and are in many places ab o lut ely impassab le fo r

,
s
'
 Th e Ex p en s e s of t h e S o v er e ig n 2 17

any heavy carriage In some places it is even dangerous to

.

travel on horseback and mules are the o nly conveyance which can
,

safely be trusted The proud minister Of an ostentatious court

.

may frequently take pleasure in executing a work o f splendour

and magnificence such as a great highway which is frequently
, ,

seen by the principal nobility whose applauses not only flatter ,

his vani t y but even contribute to support his interest at court

, .

But to execute a great number o f little works in which nothing ,

that can be done can make any great appearance o r exc ite the ,

s m al lest d egree of admiration in any trave ller and which in , ,

short have nothing t o recommend them but their extreme

,

utility is a business which appears in every respect t o o mean

,

and paltry to merit the attention o f so great a magistrate .

Under such an administration therefore such works are a lmost , ,

always entirely ne glected .

In Ch in a and i several Other governments o f As ia the

,
n ,

executive power charges itself both with the reparation of the

high roads and with the maintenance of the navigable canals .

In the instructions which are given to the governor o f each

pro vince those objects it is said are consta ntly recommended
, , ,

to him and the judgment which the court forms of his conduct
,

is ve ry much regulated by the attention which he appears to

have paid to this p art f his instructions This branch o f public
o .

police accordi ngly is said to be ve ry much attended to in all

those countries but particularly in China where the high roads
, , ,

and still more the navigable canals it is pretended exceed very , ,

much everyth ing of the same kind whi h is known in Europe c .

The accounts f those works however which have been trans

o , ,

mi t t ed to Europe have generally been drawn up by weak

,

and wondering trave llers ; frequently by stupid and lying

missionaries If they had been examined by more intelligent
.

eyes and if the a c counts of them had been reported by more

,

faithful witnesses they would not perhaps appear to be so

, , ,

wonderful The acco unt which Bernier gives Of some works

.

of this kind in Indostan falls very much short of What had been
reported o f them by other travellers more disposed to the ,

marvellous than he was It m ay t o o perhaps be in those .

, ,

countries as it is in France where the great roads the great

, , ,

commu ica tions which are likely t o be the subjects of c o n

n

versation at the court an d in the capita l are attended to and , ,

all the rest neglected I China besides in Indostan and in. n , , ,

several other governments o f Asia the revenue o f the sovereign ,

arises almost altogether from a land tax o land rent which r ,

11 H
2 1 8 The W eal t h of N at i o n s
rises falls with the rise and fall o f the annual produce of the
or

land The great interest of the sovereign therefore his revenue

.
, , ,

is in such countries necessarily and immediately onnected with c

the cultivation of the land with t h greatness o f its produce ,

e ,

and with the value o f its produce But in order to render that .

produce both as great and as valuable as possible it is necessary ,

to procure to it as extensive a market as possible and c o n ,

sequently to establish the freest the easiest and the least ex , ,

pensive communication between all the different parts o f the

country ; which can be done only by means o f the best roads
and the best navigable canals But the revenue o f the sovereign .

does o t in any part o f Europe arise chiefly from a land tax

n , ,

or land rent In all the great kingdoms o f Europe perhaps the

.
, ,

greater part of it may ulti mately depend upon the produce o f

the land but that dependency is neither so immediate nor so
: ,

evident In Europe therefore the sovereign does not feel him

.
, ,

self directly called upon t o promote the increase both in

so ,

quantity and value o f the produce of the land or by maintain , , ,

ing good roads and canals to provide the most extensive market ,

for that produce Though it should be true therefore what I

.
, ,

appr hend is not a little doubtful that in some parts o f A sia

e ,

this department of the public poli e i s ve y properly manage d c r

by the executive power there is not the least probability that , ,

during the present state f things it could be tolerably managed o ,

b y that power in any part o f Europe .

Even those public works which are of su h a nature that they c

cannot afford any revenue for maintaining themselves but of ,

whi h the convenien y is nearly onfined to some particular

c c c

pla e or distri t are always better maintained by a local

c c ,
“

or

provin ial revenue under the management of a local and p o

c ,
r

v i il ad m inistration than by the general revenue o f the state

nc a , ,

o f which the exe utive power must always have the manage
c

ment Were the streets f London to be lighted and paved at

. o

the expense Of the treasury is there any probability that they ,

would be so well lighted and paved as they are at present or ,

even at so small an expense ? The expense besides instead of , ,

being raised by a lo al tax upon the inhabitants o f each parti ular

c c

street parish or district in London would in this case be

, , , , ,

defrayed ut of the general revenue of the state and would

o ,

consequently be raised by a tax upon all the inhabitants o f the

kingdom of whom the greater part derive no sort o f benefit
,

from the lighting and paving of the streets Of London .

The abuses which sometimes creep into the local and pro
 The Ex p en s e s of t he S o v e re ig n 2 1
9
nc i
vi al administration o f a local and provin c ial revenue ho w ,

enormous soever they may appear are in reality however , ,

comparison o f those whic li

,

almost always very trifling in

c ommonly take place the administration and exp enditure o f

in

the revenue o f a great empire They are besides mu h more .

, ,
c

easily corrected Under the local o provincial administration

. r

o f the justices f the peace in Great Britain the six days labou
’
o , r

which the country people are obliged to give to the reparation

o f the highways is not always perhaps ve ry judiciously applied ,

but it is scarce ever exacted with any ircumstance of cruelty c

or Oppression In France under the administration Of the

.
,

intendan ts the application is not always more judicious and

, ,

the exaction is frequently the m ost cruel and oppressive Such .

Corv é es as they are called make o ne o f the prin ipal in st ru

, ,
c

ments of tyranny by which those o fficers chastise any parish o r

c o mmu uté which has had t he misfortune to fall under thei

’

na f
r

displeasure .

Of the P u blic Wo rks a n d I n s t i

t ut i
o n s whi
c h a r e n ecessa r
y fo r
a cili f
t a ti cular B r a n ches of Co mmerce
n g pa r ti

The obje t of the publicworks and institutions above mentione d

c

is to facil itate commerce in general But in order to facilitate .

some particular branches of it particular in stitutions are meces ,

sary which again require a particular and extraordinary expense

, .

Some particular branches of commerce whi h are arried o ,

c c n

with barbarous and uncivilised nations require extraordinary

o ui
,

protection An ordinary store

. it i
n
g house ould giv e or c -

little security to the goods of the merchants who trade to t he

western coast of Africa To defend them from the barbarou . s

natives it is ne essary that the pla e where they are deposite d

,
c c

should be in some measure fortified The disorders in t he

, ,
.

government o f Indostan have been supposed to render a lik e

pre aution ne essary even among that mild and gentle people
c c ,

and it w a under pretence of securing thei persons and property

s r

from violence that both the English and Fren h East India c

Companies were allowed to erect the first forts which they

possessed i that country Among other nations Whose vigorou
n .
, s

government will suffer no strangers to possess any fortified place

within their terri tory it may be ne essary t o m aintain som e
,
c

ambassador m in ster o consul who may both de ide accord

,
i ,
r ,
c ,

ig to their o w
n custo ms the differences arising among
n ,

his wn countrymen and in their disputes with t he n at ives

o , , ,
2 20 The W eal t h of N at i o n s
may by means of his public character interfere with more
, ,

authority and afford them a more powerful protection

, ,
than they ould expect from any private man The interests
c .

o f ommerce have frequently made it necessary to maintain

c

ministers in foreign countries where the purposes either o f ,

w a or allian e would not have required any

r c The commerce
, .

o f the Turkey Company first occasioned the esta blishment o f

an ordinary ambassador at Constantinople The first English .

e mbassies to Russia arose altogether from commercial interests .

The onstant interferenc e whi h those interests necessarily

c c

occ asioned between the subjects o f the different states o f Europe ,

has probably introduced the custom f keeping in all neigh o ,

b o u ig ountries ambassadors or ministers constantly resident

r n c ,

even in the time of peace This custom unknown to ancient .

,

t imes seems not to be older than the end o f the fifteenth o r

,

beginning o f the sixteenth entury ; that is than the time when c

ommer e first began to extend itself to the greater part of the

,

c c

nations of Europe and when they first began to attend t o its ,

interests .

It seems o t unreasonable that the extraordinary expense

n

which the protection of any particular branch of commerce may

o ccasion should be defrayed by a moderate tax upon that
parti ular branch ; by a moderate fine for example to be paid
c , ,

by the traders when they first enter into it what is more ,

o r,

equal by a particular duty of so mu h per ent upon the goods

,
c c .

which they either import into or export o ut of the particular , ,

c ountries with whi h it is carried o The protection o f trade

c n .

in general from pirates and freebooters is said to have given

, ,

o c asion to the first institution o f the duties

c f ustoms But o c .
,

if it w s thought reasonable to lay a general tax upon trade

a ,

in order to defray the expense o f protecting trade in general ,

it should seem equally reasonable to lay a particular tax upon

a parti ular branch f trade in order to defray the extraordinary
c o ,

expense f protecting that bran h

o c .

The protection o f trade in general has always been considered

a s essential to the defen e of the commonwealth and upon c , ,

that account a ne essary part o f the duty of the executive

,
c

p ower The ollection

. and application o f the general duties
c

of customs therefore have always been left to that power But

, , .

the prote tion f any particular branch o f trade is a part of the

c o

general protection f trade ; a part therefore of the duty of o , ,

that power ; and if nations a lways acted consistently the ,

arti c ular duties l evied for the purposes o f such particular

p
 Th e Ex p e n s e s of t h S o v er eig n
e 22 1

protection should always have been left equally t o its disposal .

But in this respect as well as in many others nations have

, ,

not always a ted consistently ; and in the greater part of t he

c

c ommerc ial states o f Europe parti ular companies of mer hants ,

c c

have had the address to persuade the legislature to ent ust t r o

them the performance of this part f the duty of the sovereign o ,

together with all the powers which are necessarily c o ne te d n c

with it .

These ompanies though they may perhaps have been useful

c , , ,

for the first introdu tion of some bran hes of ommer e by c c c c ,

making at their w expense an experiment whi h the s t ate

,
o n ,
c

might not think it prudent to make have in the long run proved , ,

universally either burdensome or useless and have either mis

, ,

managed or confined the trade .

When those companies do not trade upon a joint stock but ,

are obliged t admit any person properly qual ified upon pay ing
o , ,

a certain fine and agreeing to submit to the re gulations of t h

,
e

company each member trading upon his w sto k and at his

,
o n c ,

o wn risk they are called regulated c o mpanies

,
When they trad e .

upon a joint stock each member sharing in the ommon profit

,
c

or loss in proportion to his share in this sto k they are calle d c ,

joint stock companies Such companies whether regulated o .

,
r

j oint stock sometimes have an d sometimes have not exclusiv

, , ,
e

privileges .

Regu lated companies resemble in every respe t the corpora ,

c ,

tions f trades so ommon in the cities and towns f all t he

o c o

different ountries of Europe and are a sort Of enlarged mono

c ,

polies of the same kind As no inhabitant o f a town can exercis . e

an in orporated trade without first obta ining hi freedom in t he

c s

corporation so in m ost cases no subject of the state can lawfull

,
y

carry o any branch of foreign trade f whi h a regulate d

n ,
or c

company is established without first be c omi g a m ember f ,

n o

that c ompany The monopoly is more or less strict a cording

. c

as the terms Of admission are more or less difficult ; and ac ord c

ing as the directors of the company have more or less authority ,

or have it m ore less in their power to manage in such a manne

or r

as to confin e the greater part o f the trade to themselves d an

their parti ular friends In the most ancient reg ulated com
c .

panic s the privileges of apprenticeship were the same as in othe r

c orporations and entitled the person wh had served his tim

, o e

to a member f the ompany to be ome himself a member

o c c ,

either without paying any fine or upon paying a mu h smalle ,

c r

one t han what w s exacted f other people The usual orpora

a o . c
2 22 T he W e al t h of N at i o n s
tion spirit wherever the law does not restrain it prevails in all
, ,

r egulated ompanies When they have been allowed to act

c .

a cording to their
c atural genius they have always in order n , ,

to onfine the competition to as small a number o f persons as

c

possible endeavoured to subject the trade t many burdensome

,
o

regulations When the law has restrained them from doing

.

t his they have be o m e altogether useless and insignifi ant

,
c c .

The regulated companies for foreign commerce which at

p resent subsist in Great Britain are the ancient m erchant
a dventurers company now commonly alled the Hamburg
’
,
c

C ompany the Russia Company the Eastland Company the

, , ,

Turkey Company and the Afri an Company ,

c .

The terms o f admission into the Hamburg Company are

n o w said t be quite easy and the dire tors either have it o t
.

o ,
c n

i their power to subject the trade to any burdensome restraint

n

r regulations o
o at least have not o f late exercised that power
,
r, ,
.

It has not always been so About the middle o f the last century .
,

the fine f admission w fifty and at o e time one hundred

or as ,
n

pounds and the conduct of the company was said to be extremely

,

oppressive In 64 3 in 64 5 and in 66 the Clothiers and

. 1 ,
1 ,
1 1,

free traders of the West of England complained o f them to

parliament as of monopolists who confined the trade and
oppressed the manufactures of the country Though those .

c omplaints produced a t f parliament they had probably no c o

ntimidated the ompany so far as to oblige them to reform

,

i c

t heir ondu t Sin e that time at least there has been o

c c . c , ,
n

complaints against them By the t h and t h of William III . ro r1 .

c 6 the fine for admission into the Russia Company was

.
,

reduced to five pounds ; and by the st h o f Charles II c 7 2 . .

,

t hat for admission into the Eastland Company to forty shillings ,

w hile at the same time Sweden Denmark and N orway all the
, , , , ,

countries o the north side of the Baltic were exempted from

n ,

t heir exclusive charter The conduct o f those c ompanies had .

p robably given o casion to those t w o acts o f parliament

c Before .

that time Sir Josiah Child had represented both these and the
,

Hamburg Company as extreme l y oppressive and imputed to ,

their bad management the l w state o f the trade which we o

t that ti me carried o
a to the countries comprehended within n

their respective charters But though such companies may not .

,

i the present times be very Oppressive they are certainly

n , ,

a ltogether useless To be merely useless indeed is perhaps .

, ,

the highest eulogy which can ever justly be bestowed upon

regulated company ; and all the three companies above
a
 Th e Ex p en s e s of t h e S o v e r e ig n 22
3
mentioned seem in their present state to deserve this , ,

eulogy .

The fine for admission into the Turkey Company was formerly
twenty fi e pounds for all persons under twenty six years o f
-
v -

age and fifty pounds for all persons above that age N obody
,
.

but mere merchants c ould be admitted ; a restri tion which c

excluded all shopkeepers and retailers By a bye law no British .

-

manufa tures could be exported to Turkey but in the general

c

ships o f the company ; and as those ships sailed always from

the port f London this restri tion onfined the trade to that
o ,
c c

expensive port and the traders to those who lived in London

,

d in its neighbourhood By another bye law no person living ’

an .
-

within twenty miles o f London and not free f the c ity could ,
o ,

be admitted a member ; another restri tion whi h joined to c c ,

the foregoing necessarily ex luded all but the free men o f

,
c

London As the time f the loadin g and sailing o f those

. or

general ships depended altogether upon the directors they ould ,

c

.
e asily fill them with their own goods and those f their particular o

friends to the ex lusion o f others w ho they might pretend had

,
c , , ,

m ade their p p l t o late In this state of things therefore

rO o sa S o .
, ,

this ompany w as in every respe t a stri t and oppressive

c c c

monopoly Those abuses gave o asion to the t of the 6t h

. cc ac 2

o f George II c 8 reducing the fine for ad m ission to twenty

. . 1 ,

p ounds for all persons without any distin tion of ages o any ,
c ,
r

restri tion either t o mere merchants

c ,
to the freemen f ,
or o

London ; and granting to all su h persons the liberty of export c

ing from all the ports of Great Britain to any port in Turkey
, ,

a ll British goods Of whi h the exportation w a t prohibited ; c s no

a d of importing fro m then e all Turkish goods of w hi h the

n c c

importation w not prohibited upon paying both the general

as ,

d uties f customs and the particular duties assessed for defray

o ,

ing the ne essary expenses o f the ompany ; and submitting at

c c ,

the same time to the lawful authority of the British ambassador

,

a d consuls resident in Turkey and to the bye laws o f the c oni

n ,
-

p any duly ena ted To prevent any oppression

c by those
. bye
laws it w a by the same act ordained that if any seven me mbers
,
s ,

o f the company onceived themselves aggrieved by any bye lawc -

whi h should be ena ted after the passing o f this t they might
c c ac ,

a ppeal t the Board of Trade and Plantations (to the authority

o

o f which a com mittee o f the privy coun il has now su c eeded

) c c ,

provided such appeal w brought within twelve months after as

the bye law w s enacted ; and that if any seven members con
-

c eiv ed themse lves aggrieved by any bye law whi h had b een -

c
 2 24 Th e W e al t h of N a t i o n s
enacted before the passing o f this act they might bring a like ,

appeal provided it was within twelve months after the day on

,

whi h this a t was to take place The experien e of e year

c c . c on ,

however may not always be su fficient to discover to all the

,

members of a great company the pernicious tendency o f a

particular bye law ; and if several of them should afterwards
-

dis over it neither the Board of Trade nor the c ommittee o f

c , ,

council can afford them any redress The object besides of

,
.
, ,

the greater part of the bye laws of all regulated companies as -

well as of all other c orporations is not so much to Oppress those ,

w ho are already members as t o discourage others from becoming ,

so ; which may be done not only by a high fine but by many , ,

other contrivan es The constant view o f such companies is

c .

always to raise the rate o f their own profit as high as they can ;
to keep the market both f the goods which they export an d
,
or ,

for those which they import as much understocked as they can , :

which can be done only by restraining the competition or by ,

discouraging new adventurers from entering into the trade A .

fine even o f twenty pounds besides though it may not perhaps , ,

be su fficient to discourage any man from entering into the

Turkey t rade with an intention to ontinue in it may be c ,

enough t o discourage a speculative mer hant from hazarding c

a single adventure in it In all trades the regular established .

,

traders even though o t incorporated naturally combine t o

,
n ,

raise profits whi h are noway so likely to be kept at all times

,
c , ,

down to their proper level as by the occasional competition of ,

s peculative adventurers The Turkey trade though in some .

,

measure laid Open by this act o f parliament is still considered ,

by many people as ve ry far f rom being altogether free The .

Turkey Company c ontribute to mainta in an ambassador and

t w o three onsuls w h
o r like other public ministers ought to
c ,
o, ,

be maintained altogether by the state and the trade laid open ,

to all his Majesty s subje c ts The different taxes levied by the

’
.

company fo r this and other corporation purposes might afford

, ,

a revenue much more than sufli ie t to enable the sta te to c n

maintain such ministers .

Regulated companies it w a s observed by Sir Josiah Child, ,

though they had frequently supported public ministers had ,

never maintained any forts or garrisons i the countries to which n

they traded ; whereas joint stock companies frequently had .

A d in reality the former seem to be much more unfit fo r this

n

Sort of servi e than the latter

c First the directors o f a regulated .
,

company have no particular interest in the prosperity f the o

 T he Ex p en ses of t h e S o v ere i g n 22
5
general trad e of the company fo r the sake o f which such forts
a d garrisons are ma i
n ntained The de ay o f that general trad e . c

m y even frequently contribute to the advantage of their own

a

private trade ; as by diminishing the number of their com

et i
t s it may enable them both to buy cheaper and to sell
p o r ,

d earer The directors of a joint stock company on the ontrary

.
,
c ,

having only their share in the profits whi h are made upon the c

c ommon st ock committed t o their management have no private ,

trade f their w o f which the interest

o o nbe separated from c an

that o f the general trade o f the company Their private interest .

is connected with the prosperity of the general trade of the

company and with the maintenance f the forts and garrisons
,
o

which are ne essary for its defence They are more likely
c .
,

therefore t have that continual and careful attention which

,
o

that maintenance necessarily requires Se ondly the directors . c ,

o f a j o i t lst o c k company have always the management of a

n

large capital the joint stock o f the company a part of which

, ,

they may frequently employ with propriety in building repair , , ,

ing and maintaining such ne essary forts and garrisons But

,
c .

the dire tors o f a regulated company having the management

c ,

o f no common c apital have no other fund t o employ in this way

,

but the casual revenue arising from the admission fines and from ,

the corp oration duties imposed upon the trade o f the company .

Though they had the same interest therefore to attend to the , ,

maintenanc e f such forts and garrisons they can seldom have

o ,

the same ability to render that attention eff e c tual The main .

t en anc e o f a public minister requir i ng s r e any attention and ca c ,

but a moderate and limited expense is a business mu h m ore ,

c

suitab l e both to the temper and abilities f a regulated company o .

Long after the time o f Sir Josiah Child however in 75 0 a , ,

1 ,

regulated company was established the present ompany o f ,

c

m erchants trading to Africa which w expressly c harged at

,
as

first with the maintenance f all the British forts and garrisons o

that lie between Cape Blanc and the Cape o f Good Hope and ,

afterwards with that o f those only which lie between Cape Rouge
and the Cape f Good Hope The t which establishes this
o . ac

c ompany the of George II c ) seems to have had two

( 3 d 23 r . . 1

distinct objects in view ; first to restrain effectually the p p s ,

O re

sive and monopolising spirit whi h is natural to the directors c

O f a regulated company ; and secondly to force them a much , ,

s

aS ss ib
o le t o give an attention which is o t natural to them
p n
'

, , ,

towards the maintenance o f forts and garrisons .

F o the first of these purposes the fine for admission is l i

r mited
H H2
2 26 - Th e W e al t h of N at i o n s
to forty shillin gs The company is prohibited from trading i
. n

their corporate capacity upon a joint stock ; from borrowin g ,

or

money upon common seal o from laying any restraints upon ,

r

the trade which m ay be ca ried o freely from all places and r n ,

by all persons being British subjects and paying the fine The , .

government is in a committee of nine persons who meet at

L ondon but w ho are chosen annually by the freemen f the
,
o

company at London Bristol and Liverpool ; three from each , ,

place N o committee man can be cont in ued in o ffice fo more

.
-

than three years together Any committee man might be .

-

removed by the Board of Trade and Plantations w by a ,

no

committee of council after being heard in his o w defence ,

n .

The committee are forbid to export negroes from Africa o t o ,

r

import any African goods into Great Britain But as they are .

charged with the maintenance of forts and garrisons they may , ,

for that purpose export from Great Britain to A frica goods

,

and stores o f different kind O ut o f the monies which they s .

shall receive from the company they are allowed a sum not ,

exceeding eight hundred pounds for the salaries of their lerk s c

and agents at London Bristol and Liverpool the house rent of , , ,

their office at London and all other expenses o f management , ,

commission and agency in England What remai s o f this um

,
. n s ,

after defraying these different expenses they may divide amon g ,

themselves as compensation for their trouble in what manner

, ,

they think proper By this constitution it might have been

.
,

expected that the spirit of monopoly would have been effectually

restrained and the first of these purposes su fficiently answered
,
.

It would seem however that it had t Though by the 4 t h

, ,
no .

o f George III c 0 the fort of S e ega l w i

. . t h all its dependencies
2 ,
n , ,

had been vested in the company o f merchants trading to Africa ,

y et in the year following (by the s t h o f George III 44) . e .

not only Senegal and its dependencies but the whole coast ,

from the port o f Sallee in south Barbary to Cape Rouge w s , , ,

a

exempted from the j urisdiction of that company was vested in ,

the crown and the trade to it declared free to all his Majesty s
,
’

subjects The company had been suspected o f restraining the

.

trade and of establishing some sort f improper monopoly It

,
o .

is not however very easy to conceive ho w under the regulation s

, , ,

Of the 3 d George
2 r they could do so In the printed debate s .

of the House o f Commons o t always the most authentic records ,

n

o f truth I observe however that they have been accused o f

, , ,

this The members o f the committee Of ie b eigall merchants

. n n ,
n ,

and the governors and factors in their different forts and settle ,
 Th e Ex p e n s e s of t he S o v ere ig n 22
7
ments bein g all dependent upon them it is not unlikely that
, ,

the latter might have given peculiar attention to the cons ign
ments and commissions of the former which would establish
a real monopoly .

For the second of these purposes the maintenance of t he ,

forts and garr isons an annual sum has been allotted to the m
,

by parliament generally about £

,
F o the proper applica 1 r

tion of this sum the committee is obliged t account annually

,
o

to the Cursitor Baron o f Exchequer ; which account is after

wards to be laid before parliament But parliament whi h .
,
c

gives so little attention to the application o f millions is o t ,

n

likely t o give much to that of a year ; and the Cursito r

Baron of Exchequer from his profession and edu c ation is not

, ,

likely to be profoundly skilled in the proper expense o f forts

and garr iso s The captains of his Majesty s navy indeed r
n .
’
, ,
o

any other commissioned Officers appointed by the Board o f

Admiralty may inquire into the condition o f the forts and
,

garrisons and report their observations to that board B ut

, .

that board seems to have no direct j urisdiction over the c m o

mi t t ee nor any authority to correct those whose conduct it

,

may thus inquire into ; and the captains o f his Majesty s navy ’
,

besides are not supposed to be always deeply learned in t he

,

science o f fort ification Removal from an office which can b e

.

enjoyed only for the term of three years and of which t he ,

lawful emoluments even during that term are so very small

, , ,

seems to be the ut most punishment to which any committee

man is liable for any fault except direct malversation , ,
or

embezzlement either of the public money o of that f the

, ,
r o

company ; and the fear f that punishm ent can never be a o

motive o f uflic ient weight to for e a continual and careful

s c

attention to a business to which he has no other interest t o

attend The committee are accused of having sent o u t bri k s

. c

and sto nes from England for the reparation f Ca pe Coast o

Castle on the coast o f Guinea a business for which parliament ,

had several times granted an extraordinary sum of money .

These bricks and stones too which had thus been sent upon ,

so long a voyage were said to have been of so bad a qu alit

,
y

that it was necessary to rebuild from the foundation the walls

which had been repaired with them The forts and garr isons .

which lie north f Cape Rouge are not only mainta ined at t he
o

expe nse of the state but are under the immediate government
,

of the executive power ; and why those which lie south o f that
Cape and which too are in part at least maintained at the
, , ,
228 The W eal t h of N at i o n s
e xpense of the state should be under a different government, ,

it seems not very easy even t o imagine a good reason The .

protection of the Mediterranean trade w as the original purpose

o r pretence of the garrisons of Gibralta r and Minorca and the ,

m aintenance and government o f those garrisons has always

been very properly committed n o t to the Turkey Company
, , , ,

but to the executive power In the extent f its dominion con . o

sists in a great measure the pride and dignity o f that power ;

, ,

a d it is not very likely to fail in attention t o what is necessary

n

f o r the defence of that dominion The garrisons at Gibraltar .

an d Minorca accordingly have never been neglected ; though

, ,

M inorca has been twice taken and is now probably lost for ever , ,

t hat disaster was never even imputed to any neglect in the

e xecutive power I would not however be understood to
.
, ,

insinuate that either o f those expensive garrisons w ever even as ,

i n the smallest degree necessary for the purpose for wh i ch they ,

w ere originally dismembered from the Spanish monarchy That .

d ismemberment perhaps never served any other real purpose

, ,

than to alienate from England her natural ally the King o f

S pa i n and to unite the two prin cipal branches o f the house o f
,

Bourbon in a much stricter and more permanent alliance than

the ties of blood could ever have united them .

Joint stock companies established either by royal charter ,

o r by a c t of parlia ment di ffer in several respects not only from , ,

regulated ompa nies but from private copartneries

c ,
.

First in a private copartnery no partner without the consent

, , ,

o f the company can transfer his share to another person o r

, ,

i ntroduce a new member in to the company Each member .

,

h owever may upon proper warning withdraw from the c o

“

, , ,

t e y and demand payment from them of h i s share o f the

ar n r
p ,

c ommon sto k In a joint sto c k company on the contrary no

c .
, ,

m ember a demand pay ment f his share from the company ;

c n o

but each member can without their consent transfer his share , ,

t o another person and thereby introduce a new member ,

The .

v alue o f a share in a joint stock is always the price which it will

b ring in the market ; and this may be either greater or less in ,

a y proportion than the sum which its owner stands credited

n ,

fo r in the stock o f the company .

Secondly in a private copartnery each partner is bound for

, ,

t h e debts contracted by the company to the whole extent o f his

fortune In a j oint stock company o the contrary each
.
,
n ,

partner is bound only to the extent o f his share .

The trade of a j oint stock company is always managed by a

 Th e Ex p en s e s o f t he So v er e ig n 2 29

court o f directors This court indeed is frequently subj ect

.
, , ,

in many res p ects to the control f a general court of proprietors

,
o .

But the greater part f those proprietors seldom pretend t o o

understand an ything o f the business o f the company and when ,

the spirit o f faction happens not to prevail among them give ,

themselves no trouble about it but receive contentedly such ,

half yearly o r yearly dividend as the directors think proper t o

-

make to them This tota l exemption from trouble and from risk
.
,

beyond a l imited um encourages many people to becom e

“

s ,

adventurers in j oint sto c k companies who would upon n o , ,

account ha rd their fortunes in any private opartnery Such

,
za c .

companies therefore commonly draw to themselves much

, ,

g reater stocks than any private copar t nery can boast of The .

trading stock f the South Sea Company at one time amounted

o , ,

to upwards of thirty three millions eight hundred thou san d -

pounds The divided capita l o f the B ank o f England amoun ts

.
,

at present t o ten millions seven hundred and eighty thousan d

,

pounds The dire tors o f such companies however being t he

. c , ,

man agers rather of other people s money than o f the ir o w it ’

n,

cannot well be expected that they should w a t chi ov it with the er

same anxious vigil ance with whih the partners in a private c

copartn ery frequently watch over their w Lik e the steward s o n .

o f a rich man they are apt to consider attention to small matters

,

as not for their master s honour and very eas il y give themselves ’
,

a dispensation from having it N egligence and profusion there .

,

fore must always prevail more o less in the management

, ,
r ,

of the affairs of su h a ompany It is upon this account that

c c .

joi t sto k companies for foreign trade have seldom been abl e
n c

to maintain the ompetition against private adventurer They

c s .

have accordin gly very seldom suc eeded without an exclusive

, ,
c

privilege and frequently have not succeeded with o e With

,
n .

o u t an exclusive privilege they have co mmonly m is managed t h e

trade With an exc lusive privilege they have both mismanaged

.

and onfi ed it
c n .

The Royal African Company the predecessors o f the present ,

A fri an Compan y had an exclusive privilege by harter ; b u t

c ,
c

as that charter had not been confirmed by act f parli ment t he o a ,

trade in onsequence f the Declaration o f Right was soon afte

,
c o s, ,
r

the revolutio laid open to all his Majesty s subje ts The

n,
’
c .

Hudson s Bay Company are as to their legal rights in the same

’
, ,

situation as the Royal Afri an Company The ir exclusiv c . e

charter has not been onfirmed by act of parliament The c .

South Sea Company as long as they continued to be a tradin g ,

2
30 T he W e al t h of N at i o n s
c mpany had an exclusive privilege onfirmed by act of parlia
o , c

m ent ;as have likewise the present United Company o f Merchants

t rading to the East Indies .

The Royal Afri an Company soon found that they could not
c

m aintain the competition against private adventurers whom , ,

n otwithstanding the Declaration of Rights they continued for ,

some time to call interlopers and to perse ute as such In ,

c .

1 698 however the private adventurers were subjected to a duty

, ,

o f ten per cent upon almost all the different bran hes of their
. c

trade t o be employed by the ompany in the maintenance of

, c

t heir forts and garrisons But notwithstanding this heavy .

,

tax the company were still unable to maintain the competition

, .

Their sto c k and credit gradually declined In 7 their debts . 1 1 2,

ha d become so great that a particular act of parliament was

t hought necessary both for their security and for that o f their
,

creditors It was enacted that the resolution of two thirds o f

.
-

t hese creditors in number and value should bind the rest both ,

w ith regard to the time which should be allowed to the company

for the payment of their debts and with regard to any other ,

a greement which it might be thought proper to make with them

c on erning those debts

c In 730 their affairs were in so great . 1 ,

d isorder that they were altogether incapable of maintaining

t heir forts and garrisons the sole purpose and pretext of their ,

institution From that year till their final dissolution the

.
, ,

p arliament judged it necessary to allow the annual sum o f ten

thousand pounds for that purpose In 73 after having been . 1 2,

fo many years losers by the trade o f c arrying negroes to the

r

West Indies they at last resolved to give it up altogether ;to

,

s ell to the private traders to A merica the negroes which they

p ur hased
c upon the coast ; and t o employ their servants in a
trade to the inland parts of Africa fo gold dust elephants teeth r ,
’
,

d yeing drugs etc But their success in this more c on fined trade
,
.

w as not greater than in their former extensive o n e Their affairs .

c ontinued to go gradually to decline till at last being in every , ,

respect a bankrupt company they were dissolved by act of ,

p arliament and their forts and,

garrisons vested in the present
regulated ompany f merchants trading to Africa Before the
c o .

e rection of the Royal Afri an Company there had been three c ,

o ther joint stock ompanies successively established one after

c ,

a nother for the Afri an trade

,
They were all equally u suc c .
n

c essful They all however had exclusive charters which

.
, , , ,

though o t onfirmed by act of parliament were in those days

n c ,

s u pposed to convey a real exclusive privilege .

 Th e Ex p e n s e s of t he S o v ere ig n 2
3 1

The Hudson s Bay Company before their misfor t unes in the

’
,

late war had been much more fortunate than the Royal Af ri c an
,

Company Their ne essary expense is mu c h smaller The

. c .

whole number of people whom they maintain in their different

settlements and habitations whi h they have honoured with ,
c

the name f forts is said t to exceed a hundred and twenty

o ,
no

persons This number however is sufficient to prepare before

.
, ,

hand the cargo f furs and other goods necessary for load ing
o

their ships which o ac count o f the i can seldom remain

, ,
n c e,

a bove six or eight weeks l n those seas This advantage of having .

a cargo ready prepared could not f several years he acquired or

by private adventurers and without it there seems to be no ,

possibility o f trading t o Hudson s Bay The moderate apital ’

. c

o f the ompany whi h it is said does not exceed one hundred

c ,
c , ,

and ten thousand pounds may besides be su fficient to enable ,

t hem t o engross the whole o r almost the whole trade an d , ,

surplus produce of the miserable though extensive ountry ,

c ,

comprehended within their charter N o private adventurers .

,

a ccordingly have ever attempted to trade to that country in

,

c ompetition with them This ompany therefore have always . c , ,

e njoyed an exclusive trade in fact though they may have no ,

right to it in law Over and above all this the moderate capita l
.
,

o f this company is said to be divided among a very small number

o f proprietors But a joint sto k ompany consisting o f a small

. c c ,

number o f proprietors with a moderate c apital approaches , ,

very nearly to the nature of a private copartnery and may be ,

capable f nearly the same degree f vigilance and attention

o o .

It is o t to be wondered at therefore if in consequence of these

n , , ,

d ifferent advantages the Hudson s Bay Company had before

’
, ,

the late war been able t o carry ,

their trade with a onsider on c

able degree o f success It does not seem probable however .

, ,

that their profits ever approa hed to what the late Mr Dobbs c .

imagined them A mu h more sober and judic ious writer Mr

. c , .

A nderson author of Th Hit i l

,
d Ch l gi l D du ti e s o r ca an ro n o o ca e c on

of C mm
o very justly observes that upon exam ining the
erc e, ,

ac ounts which Mr Dobbs himself has given fo several years

c . r

together o f their exports and imports and upon making proper ,

allowances for their e xtraordinary risk and expense it does not ,

appear that their profits deserve to be envied or that they can ,

mu c h if at all ex eed the ordin ary profits of trade

, ,
c .

The South Sea Company never had any forts o garrisons to r

maintain and therefore were entirely exempted from o great

,
ne

expense to which o t he j o it sto k ompanies for foreign trade r n c c

 2 32 Th e W e al t h of N at i o n s
are subject But they had an immense capital divided among
.

an immense number o f proprietors It wa naturally to be . s

expected therefore that folly negligence and profusion should

, , , ,

prevail in the whole management o f their affairs The knavery .

and extravagance o f their stock jobbing proje ts are sufficiently -

c

known and the expli ation of them would be foreign to t he

,
c

present subject Their mercantile projects w e p not much

.
f re

better conducted The first trade which they engaged in was

.

that o f supplying the Spanish West Indies with negroes o f ,

which (in consequence of what w s called the Assiento contract a

g ranted them by the Treaty of Utrecht ) they had the exclusive

privilege But as it was t expected that much profit coul d
. no

be made by this trade both the Portuguese and French com ,

pna ie w
s, h had enjoyed it
o upon the same terms before them ,

having been ruined by it they were allowed as compensation , , ,

to send annually a ship of a certain burden to trade directly t o

the Spanish West Indies O f the ten voyages which this annual .

ship wa allowed to make they are said to have gained c o n

s ,

si d e ab ly by one that of the Roy l C ro li e in 73 and to hav e

r ,
a a n 1 1,

been losers more o less by almost all the rest Their ill succes s
,
r , .

was imputed by their factors and agents to the extortion an d

, ,

Oppression f the Spanish government ; but was p erhaps

o , ,

principally owing to the profusion and depredations of those

very fa tors and agents some of whom are said to have acquire d
c ,

great fortunes even in one year In 734 the company petitione d . 1 ,

the king that they might be allowed to dispose o f the trade and
tonnage o f their annual ship o account of the little profit which ,
n

they made by it and to accept of such equivalent as they cou l d

,

obtain from the King o f Spain .,

In 7 4 this company had undertaken the whale fishery O f

1 2 ,
-

this indeed they had no monopoly ; but as long as they carried

, ,

it o no other British subjects appear to have engaged in it

n, ,

O f the eight voyages whi h their ships made to Greenland the y c ,

were gainers by e and losers by all the rest After their

on ,
.

eighth and last voyage when they had sold their ships stores , , ,
and utensils they found that their whole loss upon this branch
, , ,

capital and interest included amounted t o upwards of two ,

hundred and thirty seven thousand pounds -

In 1 7 this company petitioned the parliament to be allowed

22 ,

t o divide their mmen e capital of more than thirty three millions

1 s -

eight hundred thousand pounds the whole of which had been ,

lent to government into two equal parts : The one half o r , ,

upwards o f sixteen millions nine hundred thousand pounds to ,

 T he Ex p en s e s of t h e S o v er e ig n 2 33

be put upon the same footing with other government annuities ,

and o t t o be subject to the debts contracted r losses incurred

n ,
o ,

by the directors of the company in the prosecution o f thei r

mercantile projects ; the other half to remain as before a , ,

trading stock and to be subject to those debts and losses Th e

,
.

petition w too reasonable not to be granted In 733 the y

as . 1 ,

again petitioned the parliament that three fourths o f thei -

r

trading stock might be turned into annuity sto k and only e c on

fourth re main as trading stock or exposed to the hazards arising

,

fromthe bad management o f their directors Both their annuity .

and trading stocks had by this time been redu ced more tha , ,
n

two millions each by several d ifiere t payments from govern n

ment ; so that this fourth amounted only to 8 6d s . .

In 74 8 all the demands o f the company upon the Kin g o f

1
,

Spain in consequence o f the Assiento ontract were by t he

,
c , ,

Treaty o f Aix la Chapelle given up fo what was supposed n

- -

,
r a

equivalent An end w a put to their trade with the Spanis h

. s

West Indies t he remain der of their trading stock w turned

,
as

into an annuity stock and the company ceased in every respect

,

to be a trading company .

It ought t o be observed that in the trade which the South S ea

Company carried on by means o f their annual ship the only ,

t rade by which it ever w a expected that they could make any s

co n siderable profit they were not without competitors eithe r

, ,

in the foreign or in the home market At Ca rthagena Port o .

,

Bello and La Vera Cruz they had to encounter the competitio

, ,
n

of the Spanish merchants who brought from Cadiz to thos , ,

e

markets European goods o f the same kind with the outward

,

cargo of their ship ; and in E gland they had to encounter that n

of the English merchants w ho imported from Cadiz goods o f ,

the Spanish West Indies of the same kind with the inward
cargo The goods both of the Spanish and English merchants
.
,

indeed were perhaps subject to higher duties But the loss

, , , .

occasioned by the negl igence profusion and malversation o f t he , ,

servants of the company had probably been a tax mu h heavier c

than all those duties That a joint stock company should b e

.

able to carry on su cessfully any branch of foreign trade when

c ,

private adventurers can come into any sort f open and fai r o

competition with them seems ontrary to ll experience ,

c a .

The old Engl ish East India Company was established in 600 1

by a charter from Queen Eliz abeth In the first twelve voyage s .

which they fitted ut for India they appear t o have traded as a

o ,

regulated company with separate stocks though only in t he

, ,
 2
34 . Th e W e al t h of N at i o n s
general
ships of the company In 6 they united into a joint . 1 1 2,

tock Their charter was exclusive and though not confirmed

s .
,

by act of parliament was in those days supposed to convey a

,

eal exclusive privilege For many years therefore they were

r .
, ,

not much disturbed by interlopers Their c apital which never .

,

exceeded seven hundred and forty four thousand pounds and -

f which fifty pounds w a s a share w

o not so exorbitant nor ,
as ,

t heir dealings so extensive as to afford either a pretext for gross,

egligen e and profusion o a cover t o gross malversation No t

n c ,
r .

w ithstanding some extraordinary losses occasioned partly by ,

t h e malice of the Dutch East India Company and partly by ,

o ther accidents they carried o for many years a successful

,
n

t rade But in process o f time when the principles o f liberty

.
,

w ere better understood it became every day more and more ,

d oubtful how far a royal charter t confirmed by act o f parlia ,

no

ment could convey an exclusive privilege Upon th i s question

, .

the decisions o f the courts f j ustice were not uniform but variedo ,

with the authority of government and the humours of the times .

I nterlopers multiplied upon them and towards the end of the ,

r eign o f Charles through the whole of that o f James II and .

d uring a part of that o f W i lliam III red uced them to great .

,

d istress In 69 8 a proposal w as made to parliament of

. 1 ,

a dvancing two millions to government at eight per cent provided .

t h e subscribers were erected into a new East India Company

w ith exclusive privileges The ld East India Company o ffered
. o

s even hundred thousand pounds nearly the amount o f their ,

c apital at four per cent upon the same conditions

,
.But such .

w a at that time the state of public credit that it w a more

s ,
s

c onvenient for government t o borrow two millions at eight

«

per cent than seven hundred thousand pounds at four The

. .

r
p p O s l f
o a
o the new subscribers w a s accepted and a new East ,

I ndia Company established in consequence The ld East India . o

Company however had a right to continue their trade till 70

, ,
1 1 .

They had at the same time in the name o f their treasurer

, , ,

s ubscribed very artfully three hundred and fifteen thousand

, ,

pounds into the stock o f the ew By a negligence in the n .

exp ession of the act f parliament which vested the East India
r o

t rade in the subscribers to this loan o f two millions it did not ,

appear evident that they were all obliged to unite into a joint
s tock A few private traders whose subscriptions amounted
.
,

o nly to seven thousand two hundred pounds insisted upon the ,

privilege of trading separately upon their own stocks and at their

ow risk The old East India Company had a right to a separate
n .
 T he Ex p e n s es of t h e So v e re i g n 2
35
trade upon their old stock till 70 and they had likewise both 1 1 ,

before and after that period a right like that f other private , ,
o

traders to a separate trade upon the three hundred and fifteen

,

thousand pounds which they had subscribed into the stock o f

the new company The competition of the two co mpanies with
.

the private traders and with one another is said to have well
, ,

nigh ruined both Upon a subsequent occasion in 730 when

.
,
1 ,

a proposal was made to parliament f r putting the trade under o

the management of a regulated company and thereby laying ,

it in some measure Open the East India Company in opposition

, ,

to this proposal represented in very strong terms what had

,

been at this time the miserable e ffects as they thought them

, , , ,

o f this competition In India they said it raised the price o f

;
, ,

goods so high that they were not worth the buying ; and in
England by overstocking the market it sunk their price so
, ,

lo w that no profit could be made by them That by a more .

plentiful s upply to the great advantage and conveniency o f

,

the public it must have reduced very much the price o f Indian
, , ,

goods in the E glish market cannot well be doubted ; but that

n ,

it should have raised very much their price in the Indian market
seems not very probable as all the extraordinary demand which
,

that competition could occasion must have been but as a drop

o f water in the immense ocean o f Indian commerce The increase .

o f demand besides though in the beginning it may sometimes

, ,

raise the price o f goods never fails to lower it in the long run
, .

It encourages production and thereby increases the competition ,

o f the producers wh o in order to undersell

,
e another have
,
on ,

recourse t o new divisions o f labour and new improvements of

art which might never otherwise have been thought o f The .

miserable e ffects o f which the co mpany omplained were the c

cheapness o f consumption and the encouragement given t o

production precisely the two e ffects which it is the great

,

business of political e onomy to promote The competition

c .
,

however f which they gave this doleful account had t been

,
o ,
no

a llowed to be of long ontinuan e In 70 the t w c ompanies

c c . 1 2, o

were in some measure united by an indenture tripartite to

, , ,

which the queen was the third party ; and in 708 they were 1 , ,

by c t o f parliament perfectly consolidated int o e co mpany

a ,
on

by their present name of The United Company o f Mer hants c

trading to the East Indies Into this act it was thought worth .

while to insert a clause allowing the separate traders to c ontinue

their trade till Michaelmas 7 but at the same time empower 1 11 ,

ing the directors upon three years notice t o redeem their little
,
’
,
 2
36 The W e al t h of N at i o n s
capital o f seven thousand two hundred pounds and thereby to ,

convert the whole stock of the company into a j oin t stock By .

the sam e act the capital o f the company in consequen c e o f a

, ,

new loan to government was aug mented from two mil lions to ,

three millions two hundred thousand pounds In 74 3 the . 1 ,

company advanced another million to government But this .

million being raised not by a call upon the proprietors but by

, ,

se lling annuities and contracting bond debts it did not augment -

the stock upon which the proprietors could claim a dividend .

It augmented however their trading stock it being equally

, , ,

liable with the other three m illions two hundred thousand pounds
to the losses sustained and debts contracted by the ompany , ,
c

in prose ution of their mercantile projects From 708 or at

c . 1 ,

least from 7 th is company being delivered from all c o m

1 11 , ,

p e t it and
o rs , fully established in the monopoly o f the English
commerce to the East Indies carried on a successful trade and , ,

from their profits made annually a moderate dividend t o their

proprietors During the French war which b egan in 74
.
,
1 1,

the ambition f Mr Dupleix the French governor of Pondicherry

o .
, ,

involved them in the wars f the Carnatic and in the politics of o ,

the Indian princes Af ter many signal successes and equally

.
,

signal losses they at last lost Madras at that time their prin cipal
, ,

settle ment l n India It w as restored to them by the Treat y of

.

Aix la—Chapelle ; and abo ut this time the spirit of w a and

-
r

conquest seems to have taken possession of their serv nts in a

India and never s ince to have left them Durin g the Fren h
,
. c

war whi h began in 755 their arms partook of the general

,
c 1 ,

good fort une f those o f Great Brita in They defended Madras

o .
,

took Pondicherry recovered Calcutta and acquir ed the revenues

, ,

o f a rich and extensive territory amounting it w then said , ,

as ,

to upwards o f thr ee m illions a year They remained for several .

years in quiet possession of this revenue but m 767 a dmin is . 1 ,

t a t i laid claim to their territorial acquisitions and the revenue

r on ,

arisi g from them as of right belonging to the rown ; and the

n ,
c

company in ompensation for this claim agreed to pay to

,
c ,

gove nment four hundred thousand pounds a year They had

r .

before this gradually augmented their dividend from about six

to ten per en t ; that is upon their capita l of th ee millions two
c ,
r

hundred thousand pounds they had increas ed it by a hundred

and twenty eight thousand pounds or had raised it from one
-

hundred and n nety two thousand to th ee hundred and twenty

i -
r

thousand pounds a year They were attempting about this .

time to raise it still further to twelve and a half per cent which , ,
 T h e Ex p e n s es of t h e S o v e r e ig n 2
37
would have made their annual payments t their proprietors o

equal to what they had agreed to pay annually to government ,

or t o four hundred thousand pounds a year But during the ,

.

two years in which their agreement with government was to

take place they were res t rained from any further in reas e o f
,
c

dividend by t wo successive acts of parliament of whi h the ,

c

object was to enable them to make a speedier progress in the

payment o f their debts which were at this time estimated at ,

upwards f six o seven millions sterling In 769 they renewed

o r . 1 ,

their agreement with government for five years more and ,

stipulated that during the course f that period they should be o

allowed gradually to increase their dividend to t welve and a

half pe cent never increasing it however more than o per
r .
, ,
ne

cent in one year This increase of dividend therefore when it

. .
, ,

had risen t o its utmost height could augment their annual pay ,

ments to their proprietors and government together but by

, ,

six hundred and e i ght thousand pounds beyond what they had
been before their late territorial acquisitions What the gross .

revenue o f those territorial a quisitions was supposed to amount c

to has already been mentioned ; a d by an account brought by n

the Cm ttend East Indiaman in 768 the net revenue clear

en 1 , ,

o f all deductions and military charges was stated at two millions ,

forty eight thousand seven hundred and fort y seven pounds

- -

They were said at the same t ime to possess another revenue ,

arisin g partly from lands but chiefly from the customs established ,

at their different settlements amounting to four hundred and ,

thirty nine thousand pounds The profits f their trade t o o

-
. o ,

according t o the evidence of their chairman before the House

o f Commons am ounted at this time to at least four hundred
,

thousand pounds a year ; a ording to that o f their acco untant cc ,

t o at least five hundred thousand ; a cording to the lowest c

account at least equal to the highest dividend that was to be

paid to their proprietors So great a revenue might c ert a m
,

have fio ded an augmenta tion of six hundred and eight thousand

a r

pounds in their annual payments and at the same time have ,

left a large sinking fu nd suffi c ient fo the speedy redu tion o f r c

the ir debts In 773 however their debts instead f bein g

. 1 , , ,
o

redu ed were augmented by an arrear to the treasury in the

c ,

payment o f the four hundred thousand pounds by another to ,

the custom house for duties unpaid by a large debt to t he bank

-

fo money borrowed and by a fourth for bills drawn upon them

r ,

from India and wantonly accepted to the amount f upwards

, ,
o

o f twelve hundred thousand pounds Th e dis t ress whi

ch these .
 2
36 The W e al t h of N at i o n s
capital of seven thousand two hundred pounds and thereby to ,

convert the whole stock of the company into a j oint stock By .

the same act the capital o f the company in consequen e of a

, ,
c

new loan to government was augmented from two millions t ,

o

three millions two hundred thousand pounds In 74 3 the . 1 ,

company advanced another million to government But this .

million being raised not by a call upon the proprietors but by

, ,

selling annuities and contract ing bond debts it did not augment -

the sto k upon which the proprietors could claim a dividend

c .

It augmented however their tradin g stock it being equally

, , ,

liable with the other three millions two hundred thousand pounds
to the losses sustained and debts contracted by the company , ,

in prose ution of their mercantile projects From 708 or at

c . 1 ,

least fro m 7 this company being delivered from all com

1 1 1, ,

p et it or and fully established in the monopoly o f the English

s,

commerce to the East Indies carried on a successful trade and , ,

from their profits made annually a moderate dividend to their

proprietors During the French w ar which b egan in 74
.
,
1 1,

the ambition of Mr Dupleix the French governor of Pondicherry

.
, ,

involved them in the wars of the Carnatic and in the politics of ,

the Indian princes After many signal successes and equally.

,

signal losses they at last lost Madras at that time their principal
, ,

settle ment in India It was restored to them by the Treaty of

.

Ai - —
x la Chapelle ; and about this time the spirit of w a and r

conquest seems to have taken possession o f their servants in

India and never sin e to have left them During the French
,
c .

war whi h began in 75 5 their arms partook of the general

,
c 1 ,

good fortune of those o f Great Britain They defended Madras ,

.
,

took Pondicherry re overed Calcutta and acquired the revenues

,
c ,

of a ri h and extensive territory amounting it was then said

c , , ,

to upwards of three millions a year They remain ed for several .

years in quiet possession o f this revenue but m 767 dmiis . 1 ,

a n ~

tra ti o nlaid claim to their territorial a quisitions and the revenue c ,

arisin g from them as of right belonging to the crown ; and the

,

company in co mpensation for this claim agreed to pay to

, ,

government four hundred thousand pounds a year They ha d .

before this gradually augmented their dividend from about six

to ten per en t ; that is upon their apital of three millions t wo
c ,
c

hundred tho usand pounds they had increased it by a hundred

and twenty eight thousand pounds r had raised it from o ne
-

,
o

hundred and ninety two thousand to three hundred and twenty

-

thousand pounds a year They were attempting about this .

time to raise it still further to twelve and a half per cent which ,
.
 T h e Ex p en s e s of t he S o v er e ig n 2
37
would have made their an ual payments t o their proprietors n

equal to what they had agreed to pay annually to government ,

o r t o four hundred thousand pounds a year But during the ,

.

t w o years in whi h their agreement with government w as to

c

take place they were restrained from any further in reas e o f

,
c

di idend by two successive acts o f parliament of whi h the

v ,
c

object was to enable them to make a speedier progress in the

payment of their debts which were at this time estimated at ,

upwards o f six o seven millions sterling In 769 they renewed

r . 1 ,

their agreement with government fo five years more and r ,

stipulated that during the course f that period they should be o

allowed gradually to increase their dividend to twelve and a

half pe cent never increas ing it however more than one per
r .
, ,

c ent in o e year This in rease o f dividend therefore when it

. n . c , ,

had risen t o its utmost height could augment their annual pay ,

ments to their proprietors and government together but by

, ,

six hundred and eight thousand pounds beyond what they had
been before the ir late territorial a quisitions What the gross c .

revenue f those territorial acquisitions was supposed to amount

o

t o has already been mentioned ; and by an account brought by

the C utteml East Indiaman in 768 the net revenue clear
r en 1 , ,

o f all dedu tions and mil ita ry charges w as stated at two millions
c ,

forty eight thousand seven hundred and forty seven pounds

- -

They were said at the same time to possess another revenue ,

arising partly from lands but chiefly from the custo ms established
,

at their different settlements amountin g to four hundred and ,

thirty nine thousand pounds The profits f their trade too

-

. o ,

according to the evidence o f the ir chairman before the House

o f Commons amounted at this time to at least four hundred
,

thousand pounds a year ; accordi g to that o f their ac o untant n c ,

to at least five hundred thousand ; ac ordin g to the lowest c

account at least equal to the highest dividend that was to be

,

paid to their proprietors So great a revenue might ertainly . c

have afforded an augmentation o f six hundred and eight thousand

pounds in the ir annual payments and at the same time have ,

left a large sinkin g fund sufficient for the speedy redu tion o f c

their debts In 773 however their debts instead f being

. 1 , , ,
o

reduced were augmented by an arrear to the treasury in the

,

payment f the four hundred thousand pounds by another to

o ,

the custom house for duties unpaid by a large debt to the bank
-

fo r money borrowed and by a fourth fo r bills drawn upon them

,

from India and wantonly a cepted t o the amount of upwards

,
c ,

o f t welve hundred thousand pounds The distress which these .

2
38 Th e W eal t h of N a t i o n s
accumulated claims brought upon them obliged them not o nly ,

to reduce all at once their dividend to six per ent but to throw c .

themselves upon the mercy f government and to supplicate o , ,

first a release from the further payment of the stipulated four

,

hundred thousand pounds a year ; and secondly a loan of , ,

fourteen hundred thousand to save them from immediate bank ,

r up t c y The great increase f their fortune had it seems only

. o , ,

served to furnish their se rvants with a pretext for greater p ro

fusion and a cover for greater malversation than in proportion
, ,

even to that i crease of fortune The conduct of their se v ants

n . r

in India and the general state of their affairs both in India and
,

in Europe became the subje t o f a parliamentary inquiry in

,
c ,

consequence o f whi h several very important alterations were

c

made in the constitution of their government both at home and ,

abroad In India their principal settlements of Madras Bombay

.
, ,

and Calcutta which had before been altogether independent of

o em r—
,

o n e another were subjected to a g ,

general assisted by v o ,

a council o f four assessors parliament assuming to itself the ,

first nomination of this governor and council w ho were to reside

at Calcutta ; that ity having now become what Madras was
c ,

before the most important o f the English settlements in India

, .

The court of the mayor of Calcutta originally instituted for the ,

trial o f mercantile causes whi h arose in the city and neighbour c

hood had gradually extended its jurisdi tion with the extension
,
c

o f the empire It was now redu ed and c onfined to the original

. c

purpose o f its institution Instead of it a new supreme court of

.

j ud ic at u e was established consisting of a chief justice and three

r ,

j udges to be appointed by the crown In Europe the qualific a -

.
,

tion necessary to entitle a proprietor to vote at their general

courts was raised from five hundred pounds the original price ,

of a share in the stock o f the company to a thousand pounds ,

.

I norder to vote upon this qualification too it was declared ,

ne essary that he should have possessed it if acquired by his

c ,

own purc hase and not by inheritan e for at least one year
,
c , ,

instead o f six months the term requisite before The court of

,
.

twenty four directors had before been chosen annually ; but it

-

was now enacted that each director should for the future b e , ,

chosen for four years ; six o f them however to go out of o ffice , ,

by rotation every year and not to be capable of being e chosen

,
r -

at the election o f the six new directors fo r the ensuing year In .

consequence o f these alterations the courts both of the pro , ,

i t
r e o s and directors it was expected would be likely to act
r
p , ,

with more dignity and steadiness than they had usually done
 T h e Ex p e n s es of t h e S o v e re ig n 23
9
before But it seems impossible by any alterations to rende r
.
, ,

those courts in any respect fit to govern o r even to share in t he

, , ,

government f a great empire ; be ause the greater part of their

o c

members must always have too little interest in the prosperity

o f that empire t give any serious attention to what m y
o a

promote it Frequently a man o f great sometimes even a m

.
,
an

o f small fortune is willing t o purchase a thousand pounds shar e

’ ;

in India stock merely for the influence which he expects t o

acquire by a vote in the c ourt o f proprietors It gives him a .

share though o t in the plunder yet in the appointment of t he

,
n ,

plunderers o f India ; the court o f directors though they make ,

that appointment being necessarily more o less under t he

,
r

i nfluence of the proprietors who not only elect those directors , ,

but sometimes overrule the appointments of their servants i n

India Provided he can enjoy this influence for a few years

.
,

and thereby provide for a certa in number of his friends he ,

frequently ares little about the dividend

c even about t he ,
or

value of the stock upon which his vote is founded About t he .

prosperity f the great empire in the government o f whi h that

o ,
c

vote gives him a share he seldom cares at all N o other sove

,
.

reigns ever were from the nature o f things ever could be so

,
o r, , ,

perfectly indifferent about the happiness o misery of thei r r

subjects the improvement o waste o f their dominions the glory

,
r ,

o r disgrace o f their administration as from irresistible mora l , ,

causes the greater part o f the proprietors f su h a mercantile

,
o c

company are and ne essarily must be This indifference t

,
c .
,
oo,

w a s more l i
kely to be in reased than diminished by some o f t h
c e

new regu lations whic h were made consequen e f the pa lia 111 c o 1

mentary inquiry By a resolution o f the House f Com mons

. o ,

for example it w de lared that when the fourteen hundred

,
as c ,

thousand pounds lent to the company by governm ent shoul d

be paid and their bond debts be redu ed to fifteen hundred
,
-

thousand pounds they might then and not till then divide
, , ,

eight per cent upon their apita l ;and that whatever remained
. c

of their revenues and net profits at home should be divided int o

four parts ; three f them to be paid into the ex hequer fo t h

o c r e

use o f the publi and the fourth t o be reserved as a fund eithe

c, r

fo the further reduction o f their bond debts or f

r the dis -

,
or

charge o f other contingent exigencies whi h the company might c

labour under But if the ompany were bad stewards and b d

. c ,
a

sovereigns when the whole o f their net revenue and profits

,

belonged to themselves and were at their w disposal they ,

o n ,

were surely not likely t o be better when three fourths f the m -

o
2 40 T he W e al t h of N at i o n s
w ere to belong to other people and the other fourth though to , ,

b e laid out for the benefit of the ompany yet to be so under c ,

the inspection and with the approbation o f other people .

It might be more agreeable to the company that their own

s ervants and dependants should have either the pleasure o f
w asting o r the profit o f embezzling whatever surplus might
r emain after paying the proposed dividend of eight per cent .

t han that it should come into the hands of a set o f people with
w hom those resolutions could scarce fail t o set them in some ,

m easure at variance The interest o f those servants and de

,
.

p endants might so far predominate in the court o f proprietors

a ssometimes to dispose it to support the authors o f depreda
tions which had been committed in direct violation o f its o w n

a uthority With the maj ority o f propr i etors the support even
.
,

o f the authority of their o w court might sometimes be a matter

n

o f less consequence than the support o f those who had set that

a uthority at defiance .

The regulations o f 773 accordingly did n o t put an end to

1 , ,

the disorders o f the company s government in India N o t Wit h ’

.

standing that during a momentary fit o f good conduct they

, ,

had at e time collected into the treasury o f Calcutta more

on

t han three millions sterling ; notwithstanding that they had

afterwards extended either their dominion r their depreda
, ,
o

tions over a vast accession o f some o f the ri hest and most

,
c

fertile countries in India all was wasted and destroyed They

, .

found themselv es altogether unprepared to stop o r resist the

incursion o f Hyder Ali; and in consequence o f those disorders , ,

the company is now ( 784 ) in greater distress than ever ; and

1 ,

i order to prevent immediate bankruptcy is once more reduced

n ,

t osupplicate the assistance of government Di fferent plans .

h ave been proposed by the different parties in parliament for

t h e better management o f its affairs And all those plans seem .

to agree in supposing what was indeed always abundantly

,

e vident that it is altogether unfit to govern its territorial p o s

,

s essions Even the company itself seems t be convinced o f its

. o

ow incapacity so far and seems upon that account willing to

n , , ,

give them up t o government .

With the right o f possessing forts and garrisons in distant and

b arbarous countries is necessarily connected the right of making
p eace and w in those countries
ar The joint stock companies .

w hich have had the o e right have constantly exercised the

n

o ther and have frequently had it expressly conferred upon

,
.

t hem How unjustly how capriciously how cruelly they have

.
, ,
 Th e Ex p e n s e s of t h e S o v ere ig n 24 1

co no n ly exercised
mi it is too well known from recent
,
ex p er i

e nce .

When a company o f merchants undertake at their o w risk ,

n

an d expense to establish a new trade with some remote and

,

barba rous nation it may not be unreasonable to in orp orat e

’

,
c

them into a joint stock company and to grant them in case f , ,

o

t heir success a monopoly o f the trade fo a certain number f

,
r o

y ears It is the easiest and most natural w ay in whi h t he

. c

state can recompense them for hazarding a dangerous and ex

pens ive experiment o f which the public is afterwards to re a p
,

the benefit A tempora y monopoly f this kind may be vindi

. r o

c at d upon the same principles upon which a like monopoly o f

e

a new machine is granted to its inventor and that of a ew ,

n

book to its author But upon the expiration of the term t he

.
,

monopoly ought certain ly to determine ; the forts and garrisons ,

if it w found necessary to establish any to be taken into the

as ,

hands o f government their value to be paid to the company , ,

and the trade t be laid open to all the subjects o f the state
o .

By a perpetual monopoly all the other subjects of the state e ,

ar

taxed very absurdly in t w o different ways first by the high : ,

price of goods which in the case o f a free trade they could buy
, , ,

much cheaper ; and secondly by their total exclusion from , ,

a

branch of business which it might be both convenient and p ro

fit ab le fo many o f them t o carry

r It is for the most worth on .

less o f all purposes t o that they are taxed in this manner It

,
o, .

is merely to enable the company to support the negligence p ,

ro

f usion and malversation o f their o w se vants whose disorderly

,
n r ,

conduct seldom allows the dividend of the company to exceed

the ordinary rate f profit in trades whi c h are altogether free
o ,

and very frequently makes it fall even a good deal short of that
rate Without a monopoly however a joint stock company
.
, , ,

it would appear from experience annot long carry o y ,

c n an

branch o f foreign trade To buy in o e market in order to sell . n , ,

wi t h profit in another when there are many competitors in

, ,

both ; t watch over n t only the oc asional variations in t h e

.
o ,
o c

demand but the much greater and more frequent variations in

,

the competition o in the supply which that demand is likely

,
r

to get from other people and to suit with dexterity and judg ,

ment both the quantity and quality f each assort ment f good o o s

to all these circumstances i a spe ies o f warfare o f wh i ch t he ,

.

s c

o p erations are continually changin g and whi h can sca rce eve ,
c r

be conducted successfully without su h an unremittin g exert io c n

o f vigilanc and attention as c annot long be expected from t he

e
2 4 2 T he W eal t h of N a t i o n s
d irectors of a j oint stock co mpany The East India Co mpany .
,

u pon the rede m ption f their funds and the expiration f their
o o .
,

e x c lusive privile e have a ri ht by t of parliament to c o

g g , ,
ac ,
n
t i u e a corporat on with a j o nt stock and to trade in their
n i i ,

c orporate capacity to the East Indies m common with the rest

o f their fellow subje ts But in this situation the su perior

-

c .
,
v igilance and attention f private adventurers would all
o ,
in

p robability soon make them weary of the trade

, .

An em inent French author o f great knowledge m matters o f ,

p oliti al economy
c the Abb é M o ellet ,
g ves a list f fifty fi e r ,
i o -
v

j oint sto k companies fo foreign trade which have been estab

c r

lihed in different parts o f Europe since the year 600 and

s 1 ,

which according to him have all failed from mismanagement

, , ,

notwithstanding they had exclusive privileges He has been .

m is informed with regard to the histor o f two or three o f them

y ,

w hich were not j oint stock compan ies and have not failed .

B ut in compensation there have been several j oint stock

, ,

c ompanies whi h have failed and whi h he has omitted

c ,
c .

The only trades which it seems possible for a j oint stock

c ompany to carry on successfully without an ex lusive privilege c

a re those o f which all the Operations are c apable o f being

r edu ed to what is called a Routine or to such a uniformity of
c
,

m ethod as admits o f little r no variation Of this kind is o .

,

first the banking trade ; se ondly the trade f insurance from

,
c ,
o

fire and from sea risk and capture in time o f war ; thirdly the
, ,

t rade of making and maintaining a navigable cut o canal ; r

a d fourthly t h e s i mila trade f bringing water f the supply

‘

n , ,
r o or

o f a great c ity .

Though the principles o f the banking trade may appear some

w hat abstruse the practice is capable f being reduced to strict
,
o

r ules To depart upon any oc asion from those rules in c o e

. c ,
ns

q u e c en of some flattering speculation of extraordinary gain is ,

a lmost always extremely dangerous and frequently fatal t o the , ,

b anking ompany which attempts it

c But the constitution o f .

j oint stock companies renders them in general more tenacious

o f established rules than any private C opartnery Such c o m .

p a ie
n therefore
s, seem extremely well
,
fitted for this trade The .

p rincipal banking companies in Europe accordingly are joint , ,

stock companies many o f which manage their trade very suc

,

c es fully without any exclusive privilege

s The Bank o f England .

h as no other exclusive privilege except that no other banking

c ompany in England shall consist o f more than six persons .
 T he Ex p en s e s o f t he S o v e r e ig n 24 3

The two banks o f Edinburgh are j oint stock companies without

any exclusive privilege .

The value f the risk either fro m fire

o from loss by ea , ,
or s ,

o r by capture though it cannot perhaps be cal c ulated very

, , ,

exactly ad mits however of such a gross estimation as renders

, , ,

it in some degree reducible to strict rule and method The

, ,
.

trade o f insuran c e therefore may be carried on suc c essfully by

, ,

a j oint sto ck company without any exclusive privilege N either .

the London A ssurance o the Royal Exchange Assurance n r

companies have any such privilege .

When a navigable cut or canal has been once made the ,

manage ment of it becomes quite simple and easy and it is ,

reducible to strict rule and method Even the making Of it is .

so as it may be contracted for with undertakers at so mu c h a

mile and so mu h a lock The same thing may be said of a
,
c .

canal an aquedu t or a great pipe for bringing water to supply

,
c ,

a great city Such undertak ings therefore may be and accord

ly frequently are very successfully ma i
.
, , ,

i ng i
ged by j oint
,
stock a

companies without any exclusive privilege .

To establish a joint stock company however f any under , ,

or

taking merely because such

,
o mpany might be capable Of a c

managing it successfully ; or to exempt a particular set of dealers

from some o f t h general laws whi c h take place with regard to
e

all their neighbours merely be c ause they might be apable f,

c o

thriving if they had such an exe mption would ertai ly not be ,

c n

reasonable To render such an establishment perfe tly reason

. c

able with the circ umstance o f being reducible to strict rule and
,

method two other circu mstances ought to oncur First it

,
c .
,

ought to appear with the learest evidence that the under c

taking is f greater and more general utility than the greater

o

part of common trades ; and se ondly that it requires a greater c ,

capital than can easily be colle ted into a private copartnery c .

If a moderate capital were su fficient the great utility of the ,

undertaking would not be a suffi ient reason f establishing a c or

j oint stock company ; because in this case the demand for what , ,

it was to produce would readily and easily be supplied by

private adventurers In the four trades above mentioned both.
,

those circumstan c es c oncur .

The great and general utility f the banking trade when o

prudently managed has been fully explained in the second book

o f this inqu iy But a public ba nk whi h is to support public
r . c

credit and upon parti c ular emergen ies t o advance to govern

,
c

ment the whole produce o f a tax to the amount perhaps of , , ,

244 . Th e W eal t h o f N at i o n s
several millions a year or two before it comes in requires a
, ,

greater apital than can easily be colle ted into any private
c c

copartnery .

The trade o f insurance gives great security to the fortunes

o f private people and by dividing among a great many that
,

loss which would ruin an individual makes it fall light and easy ,

upon the whole society In order to give this security how .

,

ever it is ne essary that the insurers should have a very large

,
c

cap ital Before the establishment Of the two joint stock com
.

p a
n ie fors m u e in London a
s list it
r an cis said w laid before , , ,
as

the attorney general of hundred and fifty private insurers one

who had failed in the course o f a few years .

That avigable cuts and canals and the works which are
n ,

sometimes necessary for supplying a great city with water are ,

of great and general utility while at the same time they ,

frequently requ ire a greater expense than suits the fortunes of

private people is suffi iently obvious ,
c .

Ex ept the four trades above mentioned I have not been

c ,

able to re c ollect any other in which all the three circumsta nces
requisite fo rendering reasonable the esta blishment f a joint
r o

sto k ompany c oncur The English copper company o f

c c .

London the lead smelting ompany the glass grinding com

,
c ,

pany have not even the pretext o f any great o r singular utility
,

in the object which they pursue ; nor does the pursuit o f that
object seem to require any expense unsuitable to the fortunes of
many private men Whether the trade whi h those companies
. c

carry on is redu c ible to such strict rule and method as to

render it fit fo the management of a joint sto k ompany o
r c c ,
r

whether they have any reason to boast o f their extraordinary

profits I d o o t pretend to know The mine adventurers com
,
n .
-
’

pany has been long ago bankrupt A share in the stock o f the .

British Linen Company of Edinburgh sells at present very , ,

much below par though less so than it did some years ago
,
.

The joint stock companies which are established for the publi c

spirited purpose of promoting some particular manufacture

over and above managing their o wn affairs ill to the d imiut iri
,

,
n o

o f the general stock o f the society can in other respects scarce ,

ever fail t o do m ore ha m than good N otwithstanding the most

r .

upright intentions the unavoidable partiality of their dire tors

,
c

t o parti c ular branches of the manufa c ture of which the under

takers mislead and impose upon them is a real discouragement
to the rest and necessarily breaks more or less that natural
, , ,

proportion which would otherwise esta blish itself between

 T h e Ex p en s es of t h e S o v e re i g n 24
5
judicious industry and profit and which to the general indust y , ,
r

o f the country is o f all encouragements the greatest and the

,

most e ffectual .

ARTI CLE II
Of the E xpen s e o f the I n sti
tuti
ons f
or the Educa ti
on

o f Yo u th

The institutions for the educa tion o f the youth may in the ,

s am e manner furn ish a revenue su fli

,
c i t for defraying their en

o wn expense The fee o honorary which the scholar pays to

. r

the master naturally constitutes a revenue o f this kin d .

Even where the reward f the master does not arise altogether o

from this natural revenue it still is o t necessary that it should

,
n

be derived from that general revenue o f the society of which the ,

collection and applica tion S in most countries assigned to the I , ,

executive power Through the greater part of Europe accord

.
,

in ly the endo wment Of s hools and colleges makes either no

g , c

charge upon that general revenue o but a ve ry small one It ,

r .

everywhere arises chiefly from some local o r prov incial revenue ,

from the rent of some landed estate o from the interest o f some ,
r

sum of money allotted and put under the management of trustees

fo r th is particular pu rpose sometimes by the sovereign himself , ,

and sometimes by some private donor .

Have those publi endowments contributed in general to

c

promote the end o f their insti t ution ? Have they contributed

to encourage the diligen e and to improve the abilities of the c

teachers ? Have they dire c ted the ourse f edu ation towards c o c

obje ts more useful both to the individual and to the public

c , ,

than those to which it would naturally have gone o f its own

accord ? It should t seem very difficult to give at le ast a
no

probable answer to ea h o f those questions c .

In every profession the exertion o f the greater part of those

,

who exer ise it is always in proportion to the necessity they

c

are under o f making that exertion This necessity is greatest .

with those to whom the emoluments of the ir profession are the

o n y source from whi ch they expect their for t une or even their ,

ord inary revenue and subsisten e In order to acquire this c .

fortune o even t get this subsistence they must in the course

,
r o , ,

o f a year execu t e a certain uanti t y o f work of a known value ;

,
q
and where the competition i free the rivalship of ompetitors
,
s ,
c ,

w ho are all endeavouring to justle ne another o u t of employ o

ment oblige s every man t o endeavour to execu t e his work with

,
 T he W e al t h of N a t i o n s
a certain degree of exa tness The greatness of the objects c .

which are to be acquired by success in some particular professions

may no doubt sometimes an imate the exertion of a few men
, ,

o f extraordinary spirit and ambition Great objects however .

, ,

are evidently not ne essary in order to occasion the greatest

c

exertions Rivalship and emulation render excellency even

.
,

in mean professions an object of ambition and frequently

, ,

occasion the very greatest exertions Great objects o the .

,
n

contrary alone and unsupported by the necessity of applica

,

tion have seldom been suffic ient to occasion any considerabl e

,

exertion In England success in the profession of the law

.
,

leads to some very great objects o f ambition ; and yet ho w

few men born to easy fortunes have ever in this country b een
, ,

eminent in that profession i

The endowments o f schools and colleges have necessarily
diminished more or less the ne essity of application in t he c

teachers Their subsistence so far as it arises from their

.
,

sal aries is evidently derived from a fund altogether inde p endent

,

of the ir success and reputation in their particular professions .

In some universities the salary makes but a part and fre ,

quently but a small part o f the emoluments Of the teacher , ,

o f w hi c h the greater part ar i ses from the honoraries or fees o f

his pupils The ne essity f application though always more
. c o ,

or less diminished is not in this case entirely taken away

, .

Reputa tion in his profession is still of some impo tance to him r ,

and he still has some dependency upon the afl t io gratitude ec n, ,

and favourable report of those who have attended upon hi s

instr uctions ; and these favourable sentiments he is likely t o

gain in no way so well as b dese ving them that is by the y r , ,

ab il ities and diligen e with which he dis harges eve ry part o f

c c

his duty .

In other universities the tea her is prohibited from receiving c

any honorary o fee from his pupils and his sala y constitutes
r ,
r

the whole f the revenue which he derives from his flic e His
o o .

interest is in this case set as directly in opposition to his duty

, ,

as it is possible to set it It is the interest of every man to live

.

as much at his ease as he can ; and if his emoluments are to be

precisely the same whether he does or does not perform some
,

very laborious duty it is c ertainly his interest at le ast as interest

, ,

is vulgarly understood either to neglect it altogether or if he

, , ,

is subject t o some authority whi h will not su ffer him to do this c ,

to perform it in as careless and slovenl y a manner as that

authority will permit If he I S naturally active and a lover o f
.
 Th e Ex p en s es o f t he S o v ere ig n 24
7
labour it is his interest to empl oy that activity in any way from
,
.

which he can derive some advantage rather than in the perform ,

ance of his duty from which he can derive none ,

.

If the authority to whi h he is subject resides in the bod y c

corporate the college o r university of whi h he himself is a

, , ,
c

member an d in which the greater part of the other members

,

are like himself persons who either are o ought to be teachers

, ,
r ,

they are likely to make a common cause to be ll very indulgen t ,

a

to o e another and every man to consent that hi neighbou

n ,
s r

may neglect his duty provided he himself is allowed t o neglect ,

his o w In the university o f Oxford the greater part of t h

n .
, e

pub lic professors have fo these many years g iven up altogethe ,

r , r

even the pre t ence o f teaching .

If the authority to which he is subject resides not so much ,

in the body corporate o f which he is a member as in some othe r

extran eous persons—in the bishop f the dioce se f example ;

,

o or
,

in the governor o f the provin ce ; o perhaps in some ministe

—
r, , r

o f sta te it is not indeed m this case very likely that he wi ll be

su ffered to neglect his duty altogether All that such superiors .
,

however can force him to do is to attend upo n his pupils a

, ,

ce rtain numbe r o f hours that is to give a certain number o f , ,

lectures in the week o r in the year What those le c tu res shal l .

he must still depend upon the diligence o f the teacher ; n d a

that diligence is likely to be proportioned to the motives which

he has fo exerting it An extraneous jurisdiction f this kind
r . o ,

besides is liable to be exercised both ignorantly and capri iously c

In its rit u e it is arbitrary and dis retionary and the persons

, ,

a r c ,

wh o exercise it neither attendin g upon the lectures o f t he

,

teacher themselves o perhaps understanding the scien e ,

n r c s

whi h it is his business to tea c h are seldom capable f exercising

c o

it with judgment From the i

,

nsolence of o ffice t
. they are ,
o o,

frequently indifferent how they exercise it and are very apt to ,

censure deprive him of his o ffice wantonly and without any

or ,

j ust cause The person subject to such jurisdiction necessarily

. 15

degraded by it and instead of bein g o o f the most respectable

, ,
ne
,

is rendered e of the meanest and most contemptible persons

on

in the society It is by powerful pr tection only that he ca

. o n

efiec t u lly guard himself against the bad usage to whi h he

a c rs

a t all times exposed ; and this rotection he is most likely to

p
gain o t by ability o r diligen e m his profession but by o b se
,
n c
,

q u i
o u es to
snthe w ll
i of his
s superiors and by bei g ready at , n
,

al l times t o sacrifi e to that will the rights t he interest and

,
c
, ,

the honour o f the body corporate o f whi c h he is a member .

24 8 Th e W eal t h of N a t i o n s
Whoever has attended for any considerable time to the a dmi
nis

t rat i
on of a French university must have had occasion to remark
t h e e ffects which naturally result from an arbitrary and ex
tr ane u j urisdiction of this kind
o s .

Whatever forces a certain number f students to any college o

o runiversity independent of the merit or reputation of the

,

t eachers tends more or less to diminish the necessity of that

,

m erit o r reputation .

The privileges of graduates in arts in law phy io d divinity , ,

s ,
an ,

w hen they can be obtained only by residing a certain number

o f years in certain universities necessarily force a certa in numbe r ,

o f students to such universities independent o f the merit o r ,

reputation of the teachers The privileges of graduates are a .

s o rt o f statutes of apprenticeship which have contributed t o ,

the i mprovement of education j ust as the other statutes o f ,

apprenticeship have to that f arts and manufactures o .

Th e charitable foundations f scholarships exhibitions bur o , ,

sa ri etc necessarily attach a certain number o f students

es, .
,

to certain colleges independent altogether of the merit of those

,

p rticular colleges Were the students upon such charitable

a .

foundations left free to hoose what college they liked best c ,

s u ch liberty might perhaps contribute to excite some emulation

a mong different colleges A regulation o the contrary which .
,
n ,

prohibited even the independent members o f every particular

college from leaving it and going to any other without leave ,

first asked and obtained o f that which they meant to abandon ,

would tend ve y mu h to ext inguish that emulation
r c .

If in each c ollege the tut or or teacher who w a s to i nstruct ,

ea h student in all arts and sciences should not be voluntarily

3 ,

ch eo by the student but appointed by the head o f the ollege ;

-
. n ,
c

a d if in case of neglect inability

n ,
r bad usage the student , ,
o ,

should not be allowed to change him for another without leave ,

first asked and obtained such a regulation would not only tend ,

very much to extinguish all emulation among the different

tutors of the same college but to diminish very much in all ,

o f them the necessity of diligence and f attention to their o

respective pupils Such teachers though very well paid by

.
,

their students might be as much disposed to neglect them as

,

those w ho are not paid by them at all or who have no other ,

recompe se but their salary

n .

If the teacher happens to be a man o f sense it must be an ,

unpleasant thing to him to be conscious while he is lecturing ,

his students that he is either speaking or reading nonsense or

, ,
 T h e Ex p e n s e s of t he S o v er e i g n
. 249

what is very little better than nonsense It must too be u .

, ,
n

pleasan t to him to observe that the greater part of his students

des ert his lectures or perhaps attend upon them with plain
,

enough marks o f neglect contempt and derision If he is , , .

obliged therefore to give a certain number of lectures these

, , ,

motives alone without any other interest might dispose him

, ,

to take s ome pains to give tolerably good ones Several .

diff erent expedients however may be fallen upon which w ill

, ,

e ff ectually blunt the edge f all those incitements to diligence o .

The teacher instead o f explaining to his pupil s himse lf the

,

science in which he proposes t instruct them may read so me o ,

book upon it ; and if this book is written in a foreign and dead

language by interpretin g it to them into the ir o w ; o r what
,
n ,

would give him stil l less trouble by mak ing them inte rpret it ,

to h im an d by o w and then making an occasional remark

,
n

upon it he may flatter himself that he i s giving a lecture The

,
.

sl ightest degree o f knowledge and appli c ation will enable him

to do this without exposing himself to contempt o derision o r r ,

saying anything that is really foolish absurd o r ridiculous , , .

The discipline f the college at the same t ime may enable him
o , ,

to force all his pupils to the most regular attendance upon th is

sham lecture and to maintain the most decent and respectful
,

behaviour during the whole time f the performance o .

The discipline o f colleges and universities is in general con

t i ed not for the benefit o f the students but for the interest
r v , , ,

or more properly speaking for the ease of the masters Its , .

object is in all cases to mainta in the authori t y o f the master

, , ,

and whether he neglects o performs his duty to oblige the r

,

students in all cases to behave to him as if he performed it with

the greatest diligence and ability It seems to presume perfect .

wisdom and virtue in the o e order and the greatest weakness n ,

and folly in the other Where the masters however really .

, ,

perform their duty there are no examples I believe that the

, , ,

g reater part of the students ever neglect theirs N O discipline .

is ever requisite to for e attendance upon lectures which e c ar

really worth the attendin g as is well known wherever any such ,

lectures are given Force and restraint may no doubt be in

.
, ,

some degree requisite in order to obl ige hildren o very young c ,

r

boys to attend to those parts o f education which it is thought

,

necessary for them to acquire during that early period of life ;

but after twelve or th irt een years of age provided the master ,

d oe s his duty force o restraint can scarce ever be necessary t o

,
r

carry onany part of education Such is the generosity of the .

11 1
250 Th e W e al t h of N a t i o n s
greater part o f you ng men that so far from be ing dis p osed to
, ,

neglect or despise the instructions of their master provided he ,

shows some serious intention o f bein g o f use to them they are ,

generally inclined to pardon a great deal o f incorrectness in t he

performance o f h i s duty and sometimes even to conceal from
,

the public a good deal o f gross negligence .

Those parts o f education it i s to be observed for the teaching

, ,

o f which there are no public institutions are generally the best ,

taught When a young man goes to a fencing or a dancing

.

schoo l he does not indeed always learn to fence or to dance very

,

well ; but he seldom fails o f learning to fence or to dance The .

good e ffects o f the riding school are not commonly so evident .

The ex pense o f a riding school is so great that in most places ,

it is a publ i c institution The three most essential parts o f

.

literary educat i on to read write and account it sti l l continues

, , , ,

to be more common to acquire in private than in public schools ;

and i t very seldom happens that anybody fails o f acquiring them
to the degree in which it is necessary to acquire them .

In England the public Schools are much less corrupted than

the universities In the schools the youth are taught o r at
.
,

least may be taught Greek and Latin ; that is everything which

, ,

the masters pretend to teach o r which it is expected they , , ,

should teach In the universities the youth neither are taught

.
,

nor always can find any proper means o f being taught the ,

sciences which it is the bus iness o f those incorporated bodies

to teach The reward of the schoolmaster in most cases depends
.

principally in some cases almost entirely upon the fees or

, ,

honoraries of his scholars Schools have no exclusive privileges

. .

In order to obtain the honours o f graduation it is n o t necessary ,

that a person should bring a certificate o f his having studied a

certain number of years at a public school If upon examina .

tion he appears to understand what is taught there no questions ,

are asked about the place where he learnt it .

The parts of education which are commonly taught in uni

v e si
r ties it may
,
perhaps be said are not very well taught
, ,
.

But had it not been fo those institutions they would not have
r

been commonly taught at all and both the individual and the ,

public would have suff ered a good deal from the want o f those
important parts of education .

The present universities f Europe were originally the greatero ,

part of them ecclesiastical corporations instituted for the

, ,

education o f churchmen They were founded by the authority

.

of the pope an d were so entirely under his immediate protection

, ,
 The Ex p en s es of t he So v e r e ig n 25 1

that their members whether masters o r students had all o f

, ,

them what w as then called the benefit o f clergy that is were , ,

exempted from the civil j urisdiction o f the countries in which

their respective universities were situated and were amenable ,

only to the ecclesiastica l tribunals What was taught in the .

greater part o f those universities was suita ble to the end o f

their institution either theology o someth ing that was merely
, ,
r

preparatory t o theology .

When Chris tianity was first esta blished by law a corrupted ,

Latin had become the common language o f all the western

parts o f Europe The servi c e o f the church accordingly and
.
,

the translation o f the Bible which w a read in churches were s ,

bo th in that corrupted Latin ; that is in the common language ,

o f the country After the irruption of the barbarous nations

.

w ho overturned the Roman empire Latin gradually ceased t o ,

be the language o f any part of Europe But the reverence .

o f the people naturally prese v es the esta blished forms and r

ceremonies of religion long after the circumsta nces which first

introduced and rendered them reasonable are no more Though .

Latin therefore was no longer understood anywhere by the

, ,

great body o f the people the whole service of the hurc h still ,
c

continued to be performed in that langu age Tw o d ifl e e t lan . r n

guages were thus established in Europe in the same manner as ,

in ancient Egypt ; a language of the priests and a language of ,

the people ; a sa red and a profane ; a learned and an unlearned

c

language But it was ne c essary that the priests should un der

.

stand something o f that sacred and learned language in whic h

they were to flic it ; and the study o f the Latin language
o a e

therefore m d f o m the beginning an essential part f un i

a e,
'

r , o

versity edu ation c .

It was not so with that either of the Greek o of the Hebrew r

language The inf allible decrees o f the hurc h had pronou ced
. c n

the La tin translation o f the Bible comm only alled the Latin ,
c

Vulgate to have been equally di tated by divine inspiration

,
c
,

and therefore f equal authori t y with the Greek and Hebrew

o

o riginals The knowledge o f those t w o languages therefore not

.
, ,

be ing indispensably requisite to a hur hman the study of them c c ,

did o t for a long time make a necessa ypart f the ommon

n r o c

course o f university education There are some Spanish .

ve i ti
rs e I am assured in which the s t udy f the G eek lan
s, ,
o r

guage has never yet made any part of that course The first .

reformers found the Greek text o f the N ew Testa ment and even ,

the Hebrew text of the O ld more favourable to their op inions ,

 2
5 2 The W e al t h of '
N at i
o ns

th an the Vulgate translation which as might naturally be sup , ,

posed had been gradually accommodated to support the doc

,

trines o f the Catholi Chur h They set themselves therefore c c .

, ,

to expose the many errors of that translation which the Roman ,

Catholic clergy were thus put under the ne c essity f defending o

o rexplai ing But this could o t well be done without so m e

n . n

knowledge o f the origi al langu ages of which the study was n ,

therefore gradually introdu ed into the greater part of uni c

ve i es both o f those whi c h embra ed

ti
rs ,
and o f those which c ,

rejected the do trines o f the Reformation The Greek language

,
c .

w as c onne ted with eve ry part o f that classical learning which

c ,

though at first principally cultivated by atholics and Italians c ,

happened to come into fashion mu h about the same time that c

the doctrines o f the Reformation were set on foot In the .

greater part o f universities therefore that language w as taught , ,

previous to the study o f philosophy an d as soon as the student ,

had made some progr ess in the Latin The Hebrew language .

having no conne c tion with classi al learnin g and exce pt the c , ,

Holy Scriptu res bei g t he language f not a single book l n any

,
n o

esteem the study o f it did not commonly commence till after

,

that o f philosophy and when the student had entered upon the
,

study o f theology .

O riginally the first rud iments both of the Greek and Latin
langu ages were taught in universities and in som e universiti es ,

th ey still continue to be so In others it is expected that the .

student should have previously a quired at least the rudiments c

o f o e o both f those languages

n r f which the study continues
o ,
o

to make everywhere a v efy considerable part o f university

education .

The an ient Greek philosophy was divided into three grea t

c

bran hes ; physi s o natural philosophy ; ethics o r moral

c c r

i
, ,

p h i
I O p l y
SO; and logic This general division seems perfectly .

agreeable to the nature f things o

The great phenomena o f nature—the revolutions o f the

.

heavenly bodies e lipses comets ; thunder lightning and othe

,
c , , ,
r

extraordinary meteors ; the generation the life growth and , , ,

—
dissolution f plants and animals are Objects whi h as they
o c ,

necessarily ex c ite the wonder so they naturally ca ll forth the

curiosity f mankind to inquire into their causes Superstition
,
o .

first attempted to satisfy this uriosity by referring all those c ,

wonderful appearan c es to the immediate agency of the gods .

Philosophy afterwards endeavoured to a count fo them from c r

more familiar causes o r from such as mankind were bette r , :

 T he Ex pe n s e s of t he So v ere ig n 2
53
a cquainted with than the agen y of the gods As those great
,
c .

phenomena are the first obje ts of human curiosity so the c ,

science whi h pretends to explain them must naturally have

c

been the first bran h of philosophy that was ultivated The

c c .

first philosophers a cordingly f whom history has preserved

,
c ,
o

any a count appear to have been natural philosophers

c ,
.

In every age and country of the world men must have att ended
.

t o the chara ters designs and a tions o f

c ,
e another and many ,
c on ,

reputable rules and maxims f the onduct o f human life must or c

have been laid down and approved of by common onsent As c .

soon as writing c ame into fashion wise men or those who fancied , ,

themselves su h would naturally endeavour to increase the

c ,

n umber o f those established and respected maxims and to ,

express their own sense of what was either proper improper or

c onduct sometimes in the more artifi c ial form o f apologues like

, ,

what are alled the fables f ZE p ; and sometimes in the more

c . o so

simple one of apophthegms wise sayin gs like the Proverbs ,

or ,

o f Solomon the verses o f Th o g i and Ph c ylli

,
d es and some e n s o ,

part of the works of Hesiod They might continue in this .

manner f a long time merely to multiply the number of those

or

m axims f prudence and morality without even attempti ng to

o ,

arrange them in any very distinct or methodi al order much c

less to con ect them together by one or more general pri

,

n nciples
from whih they were all dedu ible like effe ts from their
c c ,
c

natural causes The beauty of a systemati al arrangement o f

. c

di fie e t observations onne ted by a few co mmon prin c iples

r n c c

w as first seen in the rude essays of those an ient times to w ards c

a system of natural philosophy Somethi g of the same k ind . n

w as afte rwards attempted in m orals The m axims of common .

life were arranged in some methodi al order and co nected to c ,

n

gether by a few comm on prin iples in the same manner as they c ,

had attempted t arrange and connect the phenomena of nature

o .

The s ien e whi h pretends to investigate and explain those

c c c

conne t ing prin c iples what 15 properly called moral philosophy

c 18 .

Different authors gave different syste ms both f natural and o

moral philosophy But the arguments by whih they supported

. c

those different systems far fro m being always demonstrations , ,

were frequently at best but very slender probabilities and ,

sometim es mere sophisms whih had no other foundation but ,

c

the inaccuracy an d amb iguit y o f common language Specula .

‘

tive systems have in all ages o f the world been adopted for
reasons t o o frivolous to have determined the judgment of any
man o f common sense in a matter o f the smallest pecu n i a ry
2
54 Th e W eal t h of N at i o n s
interest Gross sophistry has s arc e ever had any influence
. c

upon the Opinions o f mankind except in matters of philosophy ,

and speculation ; and in these it has frequently had the greatest .

The patrons of each system f natural and moral philosophy o

naturally endeavoured to expose the weakness o f the argument s

adduced t o support the systems which were opposite to their
own In examining those arguments they were necessarily led
.
,

to consider the difference between a probable and a demonstra

tive argument between a fallacious and a conclusive o e ; and
,
n

Logic or the science o f the general principles o f good and bad

,

reasoning necessarily arose o ut o f the observations which a

,

scrutiny o f this kind gave occasion to Though in its origin .

posterior both to physics and t ethics it w a commonly taught o ,

s ,

not indeed in all but in the greater part o f the ancient schools
,

Of philosophy previously to either o f those sciences The

,
.

student it seems to have been thought ought to understand

, ,

well the differen e between good d bad reasoning before he

c an

was led to reason upon subjects of so great importance .

This ancient division o f philosophy into three parts was in

the greater part o f the universities o f Europe changed fo r
another into five .

In the ancient philosophy whatever was taught concerning ,

the nature either o f the human mind o o f the Deity made a r ,

part o f the system f physi c s Those beings in whatever their

o .
,

essence might be supposed to consist were parts o f the great ,

system o f the universe and parts too productive of the most

, , ,

i mportant e ffects Whatever human reason could either con

.

o lude o conjecture concerning them made as it were two

r , , ,

chapters though o doubt two very important ones of the

,
n ,

science whi h pretended to give an account o f the origin an d

c

revolutions o f the great system o f the universe But in the .

universities o f Europe where philosophy was taught only as

,

subservient to theology it w a natural to dwell longer upon

,
s

these t wo chapters than upon any other o f the science They .

were gradually more and more extended and were divided into ,

many inferior chapters till at last the doctrine o f spirits o f

, ,

which so little can be known came to take up as much room ,

i n the system o f philosophy as the doctrine o f bodies o f which ,

so much can be known The doctrines concerning those two .

subjects were considered as making t w o distinct sciences What .

are called Metaphysics or Pneumatics were set in opposition to

Physics and were cultivated no t only as the more sublime but
for the purposes o f a particular profession as the more i
, , ,

seful r
,
 The Ex pe n s es of t he S o v er ei g n 2 55

science o f the t wo The proper subj ect o f experiment an d

.

observation a subject in which a careful attention is capable

,

o f mak i ng so many useful discoveries w as almost entirely ,

neglected The subj ect in which after a few very simple and
.
,

almost obvious truths the most careful attention can discove r

,

nothing but Obscurity and uncertainty and can consequently ,

produce nothing but subtleties and ophisms w a s greatly S ,

cultivated .

When th o se two sciences had thus been set in Opposition to

one another the comparison between them naturally gave birth
,

to a third to what w a s called O ntology o r the science which

, ,

treated o f the qualities and attributes which were common to

both the subjects o f the other t w o sciences But if subtleties .

and sophisms composed the greater part o f the Metaphysics o r

P neumatics o f the schools they c o mp o sed t he whole o f this ,

cobweb science Of O ntology which was likewise sometimes calle d ,

M eta physics .

Wherein consisted the happiness and perfection o f a man ,

considered n o t only as an individual but as the member o f a ,

family o f a state and of the great society o f mankind was the

, , ,

object which the ancient moral philosophy proposed to investi

gate In that philosophy the duties o f human life were treated
.

o f as subservient to the happiness and perfection o f human life .

But when moral as well as natural philosophy came to be

, ,

t aught only as subservient to theology the duties f human l ife ,

o

were treated of as chiefly subservient to the happiness f a life o

to come In the ancient philosophy the perfection o f virtue

.

w as represented as necessarily productive to the person who ,

possessed it of the most perfect happiness in this life In the

, .

modern philosophy it was frequently represented as generally ,

o r rather as almost always inconsistent with any degree o f ,

happ iness in this life ; and heaven w a s to he earned only by

penance and mo t ific t io by the austerities and abasement o f
r a n,

a mo n k ; not by the liberal generous and s pirited conduct o f a , ,

ma n . Cas uistry and an ascetic morality made up in m o s t cases , ,

the greater part o f the moral philosophy o f the schools By .

far the most irnp o t an t of all the diff erent branches o f philo
r

S ophy became in this manner by f ithe most corrupted

'
a .

Such therefore wa the common course o f philosophical

, ,
s

education in the greater part of the universities in Europe .

Logic w a s taught first : O ntology came in the seco nd place :

Pneumatology comprehending the doctrine concerning t he
,

na t ure o f the human soul and of the Deity in the th ird in ,

:
 6 The W eal th of N at i ons
‘

2
5
the fourth followed a debased system o f moral philosophy wh h lc
w as considered as im m ediately conne ted with the doctrines f c o

Pneumatology with the immortality f the human soul and

, o ,

with the rewards and pun ishments which from the j ustice f ,
o

the Deity were t o be expected m a life to come a short and

, :
s uperficial system f Physics usually concluded the ourse
o c .

The alterations which the universities o f Europe thus intro

d uc ed into the ancient course of philosophy were all meant fo r

the edu c ation o f ecclesiastics and to render it a more proper

,

introduction to the study o f theology But the additional .

quantity of subtlety and ophistry the casuistry and the

S ,

ascetic morality which those alterations introduced into it ,

certainly did o t render it more proper fo r the education o f

n

gentlemen o men of the world o more likely either t o improve

r
,
r

the understanding o to mend the heart ,

r .

This ourse of ph ilosophy 5 what still continues to be taught

c 1

in the greater part o f the universities o f Europe with more o r ,

less diligence according as t he constitution of eac h particular

,

university happens to render dil igence more or less necessary t o

the tea hers In some of the richest and best endowed univer
c

s ities the tutors content the m

.

,
selves with teaching a few u c o n n

n ec t ed shreds and parcels o f this corrupted course ; and even

these they commonly teach very negligently and superficially .

The improvements which in mod ern times have been made

, ,

in several different branches o f philosophy have o t the greater n ,

part o f them been made m un ivers ities though some no doubt o

, ,

have The greater part o f universities have o t even been very

. n

forward t o adopt those improvements after they were made ;

and several of those learned societies have chosen to remain ,

for a long time the sanctuaries in which exploded systems and

,

obsolete prejudic es found shelter and protection after they had

been hunted o ut of every other corner of the world In general .
,

the r i chest and best endowed universities have been the slowest
in adopting those improvements and the most averse t o permit ,

a n y considerable change in the e stablished plan o f education .

Those improvements were more easily introduced into some o f

t h e poorer universities in which the teachers depending upon
, ,

their reputat i on for the greater part o f their subsistence were ,

obliged to pay more attent ion to the current opinions o f the

wo rld .

But though the public schools and universities o f Europe

w ere or iginally intended only for the education o f a particular
profession that o f churchmen ; and though they were not always
,
 The Ex p en s e s of the S o v er e ig n 25
7
very diligent in instructing their pupils even in the sciences
which were supposed necessary fo that profession yet they r ,

gradually drew to themselves the education o f almost all other

people particularly o f almost all gentlemen and men Of fortune
,
.

N 0 better method it seems could be fallen upon o f spendin g

, , ,

w i th any advantage the long interval between infancy and that

,

period o f 1ife at which men begin t o apply in good earnest t o

,
'

the real busine ss o f the world the business which is t o employ ,

them during the remainder o f their days The greater part o f .

what is taught in schools and universities however does o t , ,

n

seem to be the most pro per preparation fo r that business

“

In England it becomes eve ry day more and more the custom

to send young people to travel in foreign countries immedia tely
upon their leaving school and without sending them to any ,

universi t y O ur young people it i s said generally return home

.
, ,

much improved by their travels A young man who go es .

abroad at seventeen o r eighteen and returns home at e and ,

on

twen t y returns three or four years older than he w a when he

,
s

went abroad ; and at that age it is very d ifficult o t to irn p ro v e n

a good deal in three o r four years In the course o f his travels .

he generally acquires some knowledge o f o n e o r t w o fore ign

l anguages ; a knowledge however which is seldom uflic ie t t , ,
s
‘
n o

enable him either to speak or write them with propriety In .

other respects he commonly returns home more conceited more ,

unprincipled more dissipated and more incapable of any serious

, ,

application either t o study o to business than he could well have r

become in so short a time had he lived at home By travelling .

so very young by spending in the most frivolous dissipation the

,

most pre ious years of his life at a distance from the inspection
c ,

a d control of his parents and relations every useful habit which

n ,

the earlier parts o f his education might have had some tendency
to form in him instead of being riveted and confirmed is
, ,

almost necessarily either weakened e ffaced N othing but or .

the discredit into which the universities are allow ing themselves
t o fall could ever have brought into repute so very absurd a
practice as that o f travelling at this early period of life By .

sending his son abroad a father delivers himself at least fo r

.

, ,

some time from so disagreeable an object as that o f a s

,
on

unemployed neglected and going to ruin before his eyes

, , .

Such have been the effects o f some o f the modern institutions

fo r e d ucation .

Different pl ans and d ifferent institutions fo r education seem

to have taken place in other ages and nations .

11
25 8 T he W e al t h of N at i o n s
In the republics of ancient Greece every free citizen was ,

instructed under the direction o f the public magistrate in

, ,

gymnastic exercises and in music By gymnastic exercises it .

w a s intended to harden his body to sharpen his courage and , ,

to prepare him for the fatigues and dangers o f w a ; and as the r

Greek militia w a s by all accounts one o f the best that ever

, ,

w a in the world this part o f their public education must have

s ,

answered completely the purpose fo r which it w a s intended .

By the other part music it w a proposed at l east by the

, ,
s ,

philosophers and historians who have given us an account o f

those institutions to humanise the mind to soften the temper
, , ,

and to dispose it for performing all the social and moral duties
both f public and private life
o .

In ancient Rome the exercises o f the Campus M artius answere d

the same purpose as those o f the Gymnasium in ancient Greece ,

and they seem to have answered it equally well But among t he .

Romans there wa s nothing which corresponded to the musical

education o f the Greeks The morals o f the Romans however
both ln private and pu blic life seem to have bee rinot only
.
, ,

equal but upon the whole a good deal superior to those of the
, , ,

Greeks That they were superior in private life we have the

.
,

express testimony o f Polybius and o f Dionysius of Hal c arn assus 1

t w o authors well acquainted with both nations ; and the whole

t enor o f the Greek and Roman history bears witness to t he
superiority of the public morals of the Romans The good .

temper and moderation o f contending factions seems to be the

most essential circumstance in the public morals o f a free people .

But the factions f the Greeks were almost always violent an d

o

sanguinary ;whereas till the time o f the Gracchi no blood had

, ,

ever been shed in any Roman faction ; and from the time o f the
Gracchi the Roman republic may be considered as in reality
dissolved N otwithstanding therefore the very respectable
.
, ,

authority o f Plato Aristotle and Polybius and notwithstanding

, , ,

the very ingenious reasons by which Mr Montesquieu endeavours .

to support that authority it seems probable that the musical

,

education o f t he Greeks had no great e ffect in mending their

morals sic c without any such education those o f the Romans
,
n , ,

were upon the whole superior The respe t of those ancient . c

sages for the institutions of their ancestors had probably dis

posed them t o find much political wisdom m what was perhaps , ,

merely an ancient custom continued without interruption from

,

the earliest period o f those societies to the times in which they

had arrived at a considerable degree o f refinement M us i c an d .
 T he Ex p en s es of t he S o v ere i g n 2
59
d an cing are the great amusements o f almost all barbarous
n ations and the great accomplishments which are supposed
,

to fit any man for enterta ining his society It is so at th i s day .

among the negroes o n the coast o f Afri a It wa so among c . s

the ancient Celts among the ancient S andinavians and as,

c , ,

w e may learn from Ho mer among the ancient Greeks in the ,

times precedin g the Trojan w a When the Greek tribes had r .

formed themselves into little republics it was natural that the ,

study o f those accomplishm ents should for a long time make , ,

a part o f the public and common education o f the people .

The masters who instructed the young people either in music ,

o r in military exercises do not seem to have been paid or even , ,

appo inted by the state either in Rome o r even in Athens the , ,

Greek republic o f whose laws and customs w e are the best

informed The state required that every free citizen should
.

fit himself for defending it in w and should upon that account ar , , ,

learn his military exercises But it left him to learn them o f .

su h masters as he could find and it seems to have ad vanced

c ,

nothing fo this purpose but a public field o place of exerc ise

r r

in whi h he should pra tise and perform them

c c .

In the early ages both of the Greek and Roman republics ,

the other parts o f edu ation seem to have onsisted in learning c c

to read write and ac count according to the arithmetic o f the

, ,

times These a c omplishm ents the ri her citizens seem f e

. c c r

quently to have acquired at home by the assistance of some

domesti pedagogue who was generally either a slave r a
c , o
freed m ; and the poorer itizens in the schools of such
-
an c ,

masters as made a trade of tea hing f hire Such parts of c or .

edu ation however were abandoned altogether to the care o f

c , ,

the parents or guardians of each individual It does not appear .

that the state ever assu med any inspe tion direction o f them c or .

By a law o f Solon indeed the children were a quitted from , , c

mainta ining those parents in their ld age wh had neglected o o

to instruct them in some profitable trade or business .

In the progress o f refinement when philosophy and rhetoric ,

c ame into fashion the better sort f people used to send their
,
o

children to the s hools o f philosophers and rhetori c ians in order

c ,

to be instru ted in these fashionable s c ien es But those schools

c c .

were not supported by the public They were for a long time
barely tolerated by it The demand f philosophy and rhetoric . or

was for a long time so small that the first professed teachers
o f either could not find constant employment in any o e city n ,

but were obliged to travel about from place to place In this .

 260 Th e W eal t h of N a t i o n s
manner lived Z eno o f Elea P rota goras Gorgias Hippias , and , , ,

many others As the demand increased the schools both o f

.
,

philo sophy and rhetori be ame stationary ; first in Athens and

c c ,

afterw ards in several other cities The state however seems .

, ,

n ever t o have en ouraged them further than by assigning to

c
'

some o f them a particular place to teach in which was some ,

t imes done t o o by private donors The state seems to have

, ,
.

assigned the A cademy to Plato the Lyceum to Aristotle and , ,

the Porti o to Z eno o f Citta the founder o f the Stoics But

c , .

Epicurus bequeathed his gardens to his own school Till about .

the t ime o f Marcus A ntoni us however no teacher appears to n , ,

have had any salary from the public or to have had any other ,

emoluments but what arose from the honoraries o fees of his

'

scholars The bounty whi h that philosophical emperor as w e

. c ,

learn from Lucian bestowed upon o e o f the teachers f philo

,
n o

S ophy probably lasted no longer than his o w

,
life There w as n .

nothing equivalent to the privileges f graduation and to have o ,

attended any o f those s c hools w not necessary in order t o be as ,

permitted to practise any particular trade o r profession If the .

Opinion o f their own utility could not draw scholars to them ,

the law neither forced anybody to go to them nor rewarded

anybody f having gone to them The teachers had no juris
or .

diction over their pupils nor any other authority besides that ,

n atural authority whi h superior virtue and abilities never fail

,
c

to pro ure from young people towards those who are entrusted
c

with any part o f their education .

A t Rome the study o f the civil law made a part of the

,

edu ation not of the greater part f the citizens but of some
c ,
o ,

parti ular families The young people however who wished

c .
, ,

t o a quire knowledge in the law had no public school to go to

c , ,

and had no other method o f studying it than by frequenting

the company o f such of their relations and friends as were
supposed to understand it It is perhaps worth while t o remark .
,

that though the laws f the twelve tables were many of them
o , ,

copied from those o f some ancient Greek republi s yet law never c ,

seems to have grown up to be a scien e in any republic of c

ancient Gree e In Rome it became a science very early and

c .
,

gave a considerable degree f illustration to those citizens who o

had the reputation of understanding it In the republi s of . c

ancient Greece particularly in Athens the ordinary courts of

, ,

j ustice consisted of numerous and therefore disorderly bodies , ,

of people who frequently de ided almost at random or as

,
c ,

clamour faction and party spirit happened to determine The

, ,
.
 he S o v e re ign
Th e Ex p e n s e s of 2 61 t

ignomi y f an unjust decision when it was t be div ide d among

n o ,
o

five hundred a thousand fifteen hundred people (fo some

, ,
or r

o f their courts were so very numerous ) could not fall ve y heavy ,

r

upon any i dividual At Rome on the con t rary the principal

n .
, ,

courts of justice consisted either f a single judge of a sm ll o or a

number of judges whose characters especially as they deliberated

, ,

a lways in public could not fail to be very much affected by any

,

rash unjust decision In doubtful cases such courts from

or .
,

their anxiety to avoid blame would naturally endeavour to ,

s helter themselves under the example o precedent f the r o

judges w h ha d sat before them either i the same or in some

o ,
n

o ther ourt This attention to practice and precedent

c . n ec es

sa ri ly formed the Roman law into that regular and orderly

s ystem in which it has been delivered down to us ; and the like
a ttention has had the like effects upon the laws of every other
c ountry where such attention has taken place The superiority .

o f character in the Romans over that of the Greeks so much ,

remarked by Polybius and Dionysius f Hali arnassus w o c ,

as

probably more owing t the better onstitution of their courts o c

o f jus t ice than to any of the circumstances to which those

a uthors ascribe it The Romans are said to have been parti
. en

l ly distinguished for their superior respect to an oath

ar But .

the people wh were a customed to make oath only before some

o c

d iligent and well informed court of justice would naturally be

-

much more attentive to what they swore than they who were
a ccustomed to do the same thing before mobbish and disorderly
a ssemblies .

The abilities both ivil and milita ry of the Greeks and

,
c ,

Romans will readily be allowed to have been at least equal

to those f any modern natio
o O ur prejudi e is perhaps rath r n . c e

to overrate them But except in what related to milit ry . a

e xerci es the state seems to have been at no pains to form those
s ,

great abilities for I annot be induced to believe that the

,
c

musi al education f the Greeks ould be f much consequence

c o c o

in forming them M sters however had been found it seems

. a , , , ,

for instru ting the better sort f people among those natio s in
c o n
e very art and science in which the ir umstances of their society c c

r endered it ne essary conve ient for them to be instructed

c or n .

The demand for su h instru tion produ ed what it always pro c c c

d uces—the talent for giving it ; and the emulation which an

unrestrained competition never fails to excite appears t have ,
o

brought that talent to a ve y high degree of perfection In the r .

a ttention which the ancient philosophers excited in the empire ,

262 The W eal t h of N at i o n s
which they acquired over the Opinions and principles of their
auditors in the faculty which they possessed o f giving a ce rta in
,

tone and character to the conduct and conversation f those o

auditors they appear to have been much superior to any

,

modern teachers In modern times the diligence of public

.
,

teachers is more or less corrupted by the circumstances which

render them more o r less independent o f their success and
reputation in their particular professions Their salaries t o o .
, ,

put the private teacher wh would pretend to come into c o m

,
o

petition with them i the same state with a merchant who

,
n

attempts to trade without a bounty in competition with those

who trade with a considerable one If he sells his goods at .

nearly the same price he cannot have the same profit and
, ,

poverty and beggary at least if not bankruptcy and ruin will

, ,

infallibly be his lo t If he attempts t o sell them much cl earer

.
,

he is l ikely t o have so few customers that his circumstances will

not be much mended The privileges o f graduation besides
.
, ,

are in many countries necessary o at least extremely conven i ent

,
r ,

to most men o f learned professions that is t o the far greater , ,

part o f those w ho have occasion for a learned educat i on But .

those privileges can be Obtained only by attending the lectures

of the public teachers The most careful attendance upon the
.

ablest instructions of any private teacher cannot always give

any title to demand them It is from these different causes
.

that the private teacher o f any o f the sciences which are

commonly taught in universities is in modern times generally
considered as in the very lowest order o f men o f letters A man .

of real abilities can scarce find o ut a more humiliating o r a mo re

unprofitable employment to turn them to The endowments .

of schools and colleges have in this manner not only corrupted

, ,

t h diligence o f public teachers but have rendered it almost

e ,

impossible to have any good private ones .

Were there no public institutions fo r education no system , ,

no science would be taught for which there was not some

demand o r which the circumstances o f the times did not
,

render it e i ther necessary or convenient o r at l east fashionable

, , ,

to learn A private teacher could never find his account in

.

teaching either an exploded and antiquated system o f a science

acknowledged to be useful o r a science universally believed to
,

be a mere useless and pedantic heap of S ophistry and nonsense .

Such systems such sciences can subsist nowhere but in those

, , ,

incorporated societies fo education whose prosperity and revenue

r

are i a great measure independent f their reputation an d

n o
 eS o v ere i g n
The Ex p en s e s 2 63 of t h

altogether independent f their industry Were ther no public o . e

institu tions f education a gentleman after going through

or , ,

with application and abilities the most complete course of

education which the circumstances f the times were supposed o

to fi d could not come into the world completely ignorant o f

a or ,

eve ry t hing which is the common subj ect of conversation among

gentlemen and men of the world .

There are no public institutions f the educa tion o f women or ,

and there is accord ingly nothing useless absurd or fantastica l , ,

in the common course o f their education They are taught .

what their parents or guardians judge it necessary o r usefu l

for them to learn and they are taught nothing else Every
,
.

part of their education tends evidently to some useful purpose ;

either to improve the natural attractions o f their person or to ,

form their mind to reserve to modesty to chastity and t , , ,

o

economy ; to ren d er them both likely to become the m istresses

o f a family and to behave properly when they have bec om e
,

such In eve ry part o f her life a woman feels some conveniency

.

o r advant age from eve ry part f her education It se l dom o .

hap pens that a m in any part o f his life derives any c

an , on

advantage from some of the ni

,

v eni e cy n or ost laborious and

troublesome parts o f his educa tion .

O ught the publ i c therefore to g i

ve no attent ion it may be
, , ,

asked to the education f the p e ple ? O r if it ought to give

, o O

any what are the different parts o f education which it ought

,

to attend to in the d ifi t orders f the people ? and in what eren o

manner ought it to attend to them ?

In some ca es the state f the society necessaril y places the
s o

greater part f individuals i such situations as naturally form

o n

in them without any attention f gove nment almost all the

,
o r ,

ab il ities and virtues which that state requires perhaps can ,

or

admit of In other cas es the sta te of the society does not plac e
.

the gr eater part of individuals in such situations and som e ,

attention of government is necessary in order to prevent the

almost entire corruption and degeneracy o f the great body o f
the people .

In the progress of the division f labour the employment f o ,

o

the far greater part f those w h live by labour that is f the

o o , ,
o

g reat body f the people comes t obe confi ed to a few very ,

o n

simple Operations frequently to tw But the u der

,
o ne o r o . n

standi gs f the greater part f men are necessaril y formed

n o o

by their ordinary employments The man whose whole life is .

S pent in perform i ng a few sim ple Operations f which t h e ,

o
 264 .
The W eal t h of N a t i o n s
effects are perhaps always the same or very nearly the ,

same has no occas ion to exert his understanding o r to

,

exercise his invention in finding ut expedients fo removing o r

di fficulties which never occur He naturally loses therefore .

, ,

t h e habit of such exertion and generally becomes as stupid ,

and ignorant as it is possible fo a human creature to become r .

The torpor o f his mind renders him not only incapable o f

relishing or hea in g a part in any rational c o v e s t i but o f
r r a on,

conceiving any generous noble o r tender sen t irn en t and con

sequently o f forming any just j ii
, , ,

dgme t concerning many even n

of the ordinary duties o f private life O f the great and extensive .

interests of his country he is altogether incapable o f judging ,

an d unless ve particular pains have been taken to render him

y r

othe rwise he equally in capable of defending his country in

,
15

w r
a . The uniformity o f his stationary life naturally corrupts
t h e courage of his mind and makes him regard with abhorrence ,

the irregular uncert ain and adven t urous life o f a soldier It

, ,
.

corrupts even the a c t iv it yo f his body and renders him incapable _

,

o f exerting his strength with vigour and perseverance in

other employment than that to which he has been bred .

dexterity at his o w particular trade seems in th is manner t o

n , ,

be acquired at the expense f his intellectual social and mart i a l o , ,

virtues But m every improved and civilised society this I S the

.

state in t o which the labouring poor that is the great body o f , ,

the people must necessarily fall unless government tak es som e

, ,

pains to prevent it .

It otherwise m the barbarous societies as they are c ommonly

15
,

called of hunters o f shepherds and even o f husbandmen in

that ri
, , ,

1de state of husband ry which precedes the improvement

of manufactures and the extension of foreign commerce In .

such societies the varied occupations o f every man oblige eve y r

man to exert his capacity and to invent ex pedients for remov ing
d ifficulties which are continually occurring Invention i kept .
s

alive and the mind is not su ffered to fall into that drowsy
,

stupidity which in a civilised society seems to benumb the

, ,

understanding of almost all the inferior ranks o f people In .

those barbarous societies as they are called every man it has , , ,

already been observed is a warrior Eve ry man too is in some ,

.
, ,

measure a states man and can form a tolerable judgment con,

cerning the interest of the society and the conduct o f those w ho

govern it How far their chiefs are good judges in peace o r
.
,

good leaders m war is obvious t o the obse rvation of almost eve ry

,

single man among them In su c h a society indeed no man can .

, ,
 Th e Ex p en s e s of t h e S o v ere i g n '

26
5
well acquire that irnp ro v ed and refined understandin g which a
few men sometimes possess in a more civilised state Though .

in a rude so iety there is a good deal o f variety in the occupa

c

tions of every individual there is not a great deal in those o f ,

the whole society Every man does o r is capable o f doing .

, ,

almost eve y thing which any other man does o r i capable o f

r ,
s

doing Every man has a considerable degree o f knowledge

.
,

ingenuity and invention ; but scarce any man has a great

,

degree The degree however which is commonly possessed

.
, , ,

i generally sufficient for conducting the whole simple business

s

o f the soc ety In a civilised state o the contrary though

i .
,
n ,

there is little variety in the occupations of the greater part of

i ndividuals there is an almost infinite variety in those o f the
,

whole society These varied occupations present an almost

.

infinite variety o f objects to the contemplation o f those few ,

who be i ng attached to o p a t ic ul occupation the mselves

,
n . r ar ,

have leisure and inclination to examine the occupations f other o

people The contemplation of so great a variety o f Objects

.

necessarily exercises their minds in endless comparisons and

combinations and renders their understandings in an extra
, ,

ordin ary degree both acute and comprehensive Unless those

, .

few however happen to be placed in some very particular

, ,

situations their gr eat abil ities though honourable to themselves

, , ,

may contribute very little to the good government happiness or

o f their society N otwithstanding the great abilities of those

.

few all the nobler parts of the hu m an character may be in a

, ,

great measure obliterated and extinguished in t h great body

,
e

o f the people .

The education o f the ommon people requires perhaps in a c , ,

civilised and commerc ial society the attention of the public

more than that of people of some rank and fortune People o f .

some rank and fortune are generally eighteen o nineteen years r

o f age before they enter upon that particular business p o ,

r

fes is on,o r trade by which they propose to distinguish them

,

selves in the world They have before that full time to ac quire .
,

or at least to fit themselves for afterwards acquiring every ,

ac omplishment whi h can re ommend them to the publi

c c c c

esteem or render them worthy of it Their parents o guardians

,
. r

are generally su ffi iently anxious that they should be a c m c so co

p lish ed and are in m,

ost ases willing enough to lay
,
o u t the c ,

expense whi h is ne essary for that pu rpose If they are o t

c c . n

always properly edu ated it is seldom from the want of expense c ,

laid ut upon their education but from the improper applica

o ,
2 66 T he
W eal t h of N at i o n s
tion f that expense It is sel d om from the want of masters
o .
,

but from the negligence and incapacity of the masters who are
to be had and from the difficulty o r rather from the imp o ssi
, ,

bi lit y which there is in the present state of things of fin din g

,

any better The employments too in which people o f some

.
, ,

rank o r fortune spend the greater part of their lives are not ,

l ike those o f the common people simple an d uniform They , .

are almost all o f them extremely complicate d and such as ,

exercise the head more than the hands The understandings o f .

those who are engaged in such employments can se l dom grow

torpid fo r want o f exercise The employments of people o f.

some rank and fortune besides are se l dom such as haras s them
, ,

from morn ing to night They generally have a goo d d eal o f

.

leisure during which they may perfect themse lves in every

,

branch either o f useful o r ornamental knowledge of which the y

may have laid the foundation o for which they may have ,
r

a cqu ired some taste in the earlier part of life .

It is otherwise with t he common people They have little .

time to spare for education Their parents can scarce aff ord t o
.

maintain them even in infancy As soon as they are able t o .

work they must apply to some trade by which they can earn
their subsistence That trade too is general ly so simple and
.
, ,

uniform as to give littl e exercise to the understanding while , ,

at the same time their labour is both so constant an d so severe

, ,

that it leaves them l ittle leisure and less inclination to app ly to ,

or even to think o f anything e l se

,
.

But though the common people cannot in any civilised ,

society be so well instructed as people o f some rank and fortune

, ,

the most essential parts o f education however to read write , , , ,

and account can be acquired at so earl y a period o f life that

,

the greater part even of those who are to be bred to the lowes t
occupations have time to acquire them before they can be
employed in those occupations For a very small expense the .

public can facilitate can en ourage and can even impose upon
,
c ,

almost the whole body o f the people the necessity of acqu iring
those most essential parts o f education .

The public can facilitate this a quisition by establishing in c

every parish o r district a little school where children may be ,

taught fo r a reward so moderate that even a common laboure r

may afio d it ; the master being partly but o t wholly paid by
r ,
n ,

the public because if he was wholly o r even principally paid

, , , ,

by it he would soon learn to neglect his business In Scotland

,
.

the est a blishmen t zo f such parish schools has taught almost the
 The Ex p en s e s of t h e So v e r ei g n 2 67

whole common people to read an d a very great prop ortion o f ,

them to write and account In Englan d the esta blishment o f

.

charity schools has had an effect o f the same kind though n o t ,

so universally beca use the establis hment is not so universal

,
.

If in those little schools the books by which the c hil dren a e ,

r

taught to read were a little more instructive than they commonl y

,

are and if instead o f a little smattering o f Latin which t h

, , ,
e

c hil dren o f the common people are sometimes taught there and ,

which can scarce " ever be o f an y use to them they were ih ,

structed in the e l ementary parts of geometry an d mechanics ,

the literary education o f this rank o f people would perhaps b e

as complete as it ca be There is scarce a common trad e
n .

which does o t afford some Opportun ities o f applyin g to it t h

n e

principles o f geometry and mechanics an d which would not ,

therefore gradually exerc ise and improve the common people in

those principles the necessary introduction to the most sublim e
,

as well as to the most useful scien es c .

The public ca encourage the acquisition o f those mos t

n

es sential parts o f education by giving small premiums and ,

little badges o f distin ction to the chil dren o f the common peopl
,
e

who excel in them .

The public can impose upon almost the whole body of t he

people the necessity of acqu iring those most essential parts o f
education by obliging every man to undergo an examination o r
,

probation in them before he obtain the freedom in an y

can

corpo ration o be allowed t o set up any trade either in a village

,
r

or town corporate .

It was in this manner by facil itating the ac quisition of their

,

mi litai
'

y and gymnastic exercises by encouragi n g it and even

, ,

by 1mp o sin gupon the whole body o f the people the necessity o f
learnin g those exercises that the Greek and Roman republic
,
s

mainta ined the martial spirit of their respective citi ens They z .

facilitated the acquisition of those exercis es by appo inting a

certa in place for learn in g d practising them and by granting
an ,

to erta in masters the priv il ege o f teachin g in that place Those

c .

masters do n o t appear to have had either salaries o exclusiv r e

privileges o f any k ind Their reward consisted altogether in

.

what they go t from their scholars ; and a citizen who had learnt
his exercises in the pub lic gymna ia had no sort o f legal a d s

vantage over o e w ho had learnt them privately provided

n ,

the latter had learnt them equally we ll Those republics e . n

c o urag ed the acquisition o f those exercises by bestowin g l ittle

premiums and badges o f d istinction upon those who excelled in

 2 68
'

T he W e al t h of N at i o n s
them To have gained a prize in the O lympic Isthmian o r
.
, ,

N em games gave illustration not only to the person w ho

aean , ,

gained it but to his whole family and kindred The obligation

, .

which every itizen was under to serve a certain umb e o f

c n 1

years if alled upon in the armies o f the republic sufficiently

,
c , ,

imposed the necessity o f lea n igt ho s exercises without which r n e ,

he ould t be fit for that servi e

c no c .

That in the progress of improvement the practi e of military c

exercises unless government takes proper pains to support it

, ,

goes gradually t o decay and together with it the martial spirit , , ,

o f the great body f the people the example o f modern Europe

o ,

s u fficiently demonstrates But the security of every society .

must always depend more less upon the martial sp irit of the,
or ,

great body o f the people In the present times indeed that .

, ,

martial spirit alone and unsupported by a well dis iplined ,

-

sta nding army would not perhaps be sufficient fo r the defence

,

an d se urity f any society

c But where every citizen had the
o .

spirit of a soldier a smaller standing army would surely be

,

requisite That spirit besides would necessarily diminish very

.
, ,

much the dangers t o liberty whether real o r imaginary which , ,

a e commonly apprehended from a standing army

r As it would .

very mu c h fa ilitate the operations o f that army against a

c

foreign invader so it would obstruct them as mu h if u fo t u

,
c ,
n r

h ately they should ever be directed against the constitution of

,

t he state .

The ancient institutions of Gree e and Rome seem to have c

b een mu h more e ffe tual fo maintaining the martial spirit o f

c c r

the great body o f the people than the establishment f what o

a re called the militias of modern times They were much more .

~

s imple When they were on e established they exe uted them

. c c

s elves and it required little

,
no attention from government to or

maintain them in the most perfect vigour Whereas to main .

t ain even in tolerable execution the complex regulations of

, ,

an y modern militia requires the continual and painful

,
attention
o f government without which they are c onstantly falling into
,

t otal neglect and disuse The influence besides f the anci ent .
, ,
o

institutions w a mu h more universal By means o f them the

s c .

whole body o f the people was completely instru ted in the use c

o f arms Whereas it is but a very small part of them who can

.

ever be so instru ted by the regulations of any modern militia

c ,

ex ept perhaps that of Switzerland But a coward a man

c , ,
.
,

incapable either o f defending f revenging himself evidently or o ,

w ants o e o f the most essenti al p art s o f the character of a man

n .
 heS o v er e ig n
T he Ex p en s e s of 2 69 t

He is as much mutilated and defo med in his mind as anothe r r

is in his body who is either deprived of some of its most essen

,

tial members or has lost the use o f them He is evidently t h

,
. e

more wretched and miserable of the t w ; because happ ines o s

and misery which reside altogether in the mind must necessarily

, ,

depend more upon the healthful unhealthful the mutilated or ,

or entire state f the mind than upon that of the body Even
o ,
.

though the martial spirit f the people were f no use towards o o

the defen e of the so iety yet to prevent that sort of mental

c c ,

mutil ation deformity and wretchedness whi h owardi e meces

, , ,
c c c

sa r ly i
i nvolves in it from preading themselves through the,
S

g reat body f the people would

o still deserve the most serious ,

attention f government in the same manner as it would

o ,

deserve its most serious attention t prevent a leprosy or any o

'

other loathsome and o ffensive disease though neither mortal ,

nor dangerous from spreading itself among them though

, ,

perhaps no other public good might result from such attention

besides the prevention f so great a pub lic evil o .

The same thing may be said f the gross ignorance and o

stupidity which in a civil ised society seem so frequently t

, , o

benumb the understandings f all the inferior ranks f people o o .

A man without the proper use of the intellectual faculties f a o

man is if possible more contemptible than even a coward and

, , , ,

se ems t be mutilated and deformed in a still more essential

o

part of the character f human nature Though the state w o . as

to derive no advantage fro m the instruction of the inferio r

rank s of people it would still deserve its attention that they

,

should not be altogether uninstru ted The state however c .

, ,

derives no inconsiderable advanta e from their instruction g

.

The more they are instructed the less liable they are to t he
delusions of enthusiasm and superstition which among ignorant , ,

nations frequently occasion the most dreadful disorders A

, . n

instructed and intelligent people besides are always more decent , ,

and orderly than an ignorant and stupid They feel them o ne .

selves each individually more respectable and more likely t

, , o

obta in the respect f their lawful superiors and they are there
o ,

fore more disposed to respect those superiors They are more .

disposed to examine and more capable of seei g through t h ,

n
,
e
interested complaints of faction and sedition and they are upon , ,

that account less apt to be misled i to any wanton u

,
n or n n ec es

sary opposition to the measures f government In fre o . e

countries where t h safety f government depends very much
e o

upon the favourable judgment which the people may form f

,

o
2
7 0 T he
W eal t h of N a t i o n s
i
ts conduct it must surely be f the highest i mportance that
,
o

they should not be disposed to j udge rashly or capriciously

c oncerning it .

ARTI C LE III
Of the Expen s e o f the I tu ti
n s ti o ns for the I ns tr uc t i
on o f
P eo ple o f a ll A ges

THE institutions for the instruction o f people o f all ages are

c hiefly those for religious instruction This is a species .

o f instruction o f which the Object is not so much to render

the people good citizens in this world as to prepare them ,

fo r another and a better world in a life to c ome The .

teachers of the doctrine which contains this i nstruction in ,

the same manner as other teachers may either depend alto ,

g ether for their subsisten e upon the voluntar y contributions

c

o f their hearers or they may derive it from some other fund to

,

which the law of their co unt ry may entitle them ; such as a

l anded estate a tythe o r land tax an established salary o r
, ,

s tipend Their exertion their zeal and industry are likely to

.
, ,

be much greater in the former situation than in the latter In .

this respect the teachers of new religions have always had a

c onsiderable advantage in attacking those ancient and estab

l ihed systems f which the clergy reposing themselves upon

s o ,

their b e efic had neglected to keep up the fervour of faith

n es ,

and devotion in the great body f the people and having given o ,

themselves up to indolence were become altogether incapable ,

o f making any vigorous exertion in defence even o f their o w n

e stablishment The clergy o f an established and well endowed

.
-

religion frequently be c ome men o f learning and elegance who ,

possess all the virtues f gentlemen o whi h can recommend

o ,
r c

them to the estee m o f gentlemen ; but they are apt gradually

to lose the qualities both good and bad which gave them
, ,

a uthority and influence with the inferior ranks f people and o ,

w hich had perhaps been the original causes o f the success and
e stablishment of their religion Such a clergy when attacked .
,

by a set o f popular and bold though perhaps stupid and ignorant ,

e nthusiasts feel themselves as perfectly defenceless as the indo

,

lent e ffeminate and full fed nations o f the southern parts o f

, ,
-

A sia when they were invaded by the active hardy and hungry , ,

Tartars o f the N orth Such a clergy upon such an emergen y

.
,
c ,

h ave commonly no other resource than to call upon the civil

m agistrate to persecute destroy o r dr i ve o u t their adversaries
, , ,
 Th e Ex p e n s e s of t he S o v er e ig n 2
7 1

as dis t urbers o f the public peace It was thus that the Roman .

Catholic clergy ca lled upon the civil magistrate to persecute

t h e P o t e t a t s and the Church o f E n gland to p ersecute t h e
/ r s n ,

Dissenters ; and that in general every rel igious sect when it has ,

once enjoyed for a century o r two the security o f a legal estab

lish me t nh s found itself incapable o f maki g any vigorous
,
a n

defence against any new sect which chose t o attack its do c trine
o r discipline Upon such occasions the advantage in poin t Of
.

learning and good writing may sometimes be o n the side o f the

established church But the arts o f popularity all the arts of
.
,

ga in ing proselytes are constantly o the side o f its adversaries

,
n .

In England those arts have been long neglected by the well

endowed c l ergy o f the esta blished church and are at present ,

chiefly cultivated by the Dissenters and by the Methodists .

The independent provisions however which in many places , ,

have been made fo r dissenting teachers by means o f voluntary

subscriptions o f trust rights and other evasions f the law
, ,
o ,

seem very much to have abated the zeal and activity o f those
teachers Th ey have many o f them become very learned i
.
,
n

g e ino u s and ,
respectable men ; but they have in general cea s ed
to be very popular preachers The Methodists without half .
,

the learning o f the Dissenters are much more in vogue ,

.

In the Church o f Rome the in d u st 1y and zeal o f the in ferior

,

clergy are kept more alive by the powerful motive of self

interest than perhaps in any established Protestant church .

The parochial clergy derive many o f them a very considerable , ,

part f their subsistence from the voluntary oblations o f the

o

pe ople ; a source of revenue which confession gives them many

Opportunities o f improving The mendica nt orders derive their .

whole subsistence from such oblations It is with them .

as with the hussars and light i n fant ry o f some armies ; o n

plunder o pay The parochial clergy are like those teachers

,
n .

whose reward depe nds partly upon their salary and partly upon ,

the fees o r honoraries which they get fro m their pupils and ,

these must always depend more less upon their industry and or

reputation The mendica nt orders are like those teachers whose

.

subsistence depends altogether upon their industry They are .

obliged therefore to use every art which can animate the

, ,

devotion of the common people The esta blishment o f the two .

great mendicant orders of St Domini c and St Francis it is . .

,

observed by Mac hiavel revived in the thirteenth and fourteenth

, ,

centuries the languishing faith and devotion o f the Catholic

,

Church In Roman Ca tholic countries the spirit f devotion is

. o
 2
7 2 The W e al t h of N at i o n s
supported altogether by the monks and by the poorer parochia l
clergy The great dignitaries of the church with all the a ecom
.
,

p lishm e t s o f gentlemen and men o f the world and sometimes

n
,

with those of men of learning are careful enough to maintai n ,

the necessa y discipline o ver their in feriors but seldom g ive

r
,

themselves any trouble about the instruction o f the people .

Most o f the arts and professions in a state says by far the ,

m o st illustrious philosopher and historian of the present age ,

are of such a nature that while they promote the interests of

,

the society they are also useful or agreeable to some individuals ;

,

and in that case the constant rule o f the magistrate except

, ,

perhaps on the first introduction o f any art is to leave the ,

profession t o itself and trust its encouragement to the i d iv i

,
n

duals who reap the benefit of it The artisans finding the i r .

,

profits to rise by the favour o f their customers increase as ,

much as possible their skill and industry; and as matters are

n o t disturbed by any injudicious tampering the commodity i s ,

always sure to be at all times nearly propo rtioned to the demand .

But there are also some callings which though useful and , ,

even necessary in a state bring no advantage p l easure to

,
or

any individual and the supreme power is obliged to alter its

,

conduct with regard to the retainers of those professions It .

must give them public encouragement in order to their sub

sistence and it must provide against that negligence t o which
,

they will naturally be subject either by annexing particular ,

honours to the profession by establishing a long subordination

,

of ranks and a strict dependance o r by some other expedient ,

.

The persons employed in the finances fleets and magistracy , , ,

are instances o f this order f men o .

It may naturally be thought at first sight that the eccle , ,

sia ti
s c belong to the first class and that their encouragement
s , ,

as well as that o f lawyers and physicians may safely be em ,

trusted to the liberality of individuals who are attached to ,

their doctrines and who find benefit or consolation from their

,

spiritual ministry and assistance Their industry and vigilance .

will no doubt be whetted by such an additional motive ; and

, ,

their skill in the profession as well as their address in governing

,

the minds of the people must receive daily increase from their
,

inc reasing practice study and attention , ,

.

But if we conside r the matter more closely we shall fin d ,

that this interested diligence o f the clergy is what every wise

legislator will study to prevent ; because in every religion except
the true it is highly pernicious and it has even a natural ,
 T h e Exp ense s o f t h e S o v e r e ig n 2
73
tendency to pervert the tr ue by infusi g into it a strong mixture ,
n

o f supe rstition folly d delusion,

Each ghostly practitioner
,
an .
,

in order to render himself m ore pre c ious and sacred in the eyes
o f hi s reta i
ners will i spire them with the most violent abhor
,
n

rence f all other sects and onti ually endeavour by some

o ,
c n ,

n ovelty t o excite the langu id devotion o f his audien e N o

,
c .

regard will be paid t o truth morals de en y in the doct rines , ,

or c c

in ul ated Every tenet will be adopted that best suits the

c c .

d isorderly affe tions o f the human f ame

c Customers w ill be r .

drawn to ea h conventi le by new industry and address in

c c

practising the pas sions and reduli t y o f the populace A d

on c . n

in the end the civil magistrate will fi d that he has dearly paid
,
n

for hi pretended frugality in saving a fixed establishm ent fo

s ,
r

the priests ;and that m reality the most decent and advantageous
c omposition which he can make with the spiritual guides is to ,

b ribe their in dolence by as sig ing stated salaries to their pro n

f essi
o and rendering it superfluous fo them to be farther
n, r

a ctive than merely to prevent their flo k from strayi ng in c

quest of new pastures And in this man er eccles iasti ca l . n

establishments though ommonly they arose at first from

,
c

religious views prove in the end adva ta geous to the politi al

,
n c

i nterests o f society .
’

But whatever may have been the good o bad e ffe ts of the r c

in depe ndent provision f the clergy t has perhaps been very o ,

i , ,

seldom bestowed upon them from any view to those eff ects .

Times f violent religious ontroversy have generally been times

o c

o f equally violent political faction Upon su h occasions each . c ,

p o litical party has either found it imagi ed it f r its interest ,

or n ,
o

t o league its elf with some e o other f the ontending hgiu on r o c re o s

se ts But this ould be done only by adopting o at least by

c . c ,
r

favouring t he tenets o f that particular se t The se c t which

,
c .

had the good fort une t o be leagued with the onquering part y c

ne essarily shared in the victory f its ally by whose favour

c o ,

an d protection it w as soon enabled in so m e degree to silen e c

and subdue all it s adversaries Those adversaries had generally .

leagued themselves with the enemies of the onquering party c ,

and were therefore the enemies f that party The clergy o f o .

th is particular se t havin g thus be ome complete masters Of the

c c

field and their influence and authority with the great b ody f
,
o

the people bein g in its highest vigour they were powerful enough ,

t o overawe the chi efs and leaders of t heir w part y and to o n ,

o blige t h e c ivil magistr ate to respe t their o inion and incli na

p c s
‘
tion Their first deman d w as generally that he should silence
s .
2
74 W T he
eal t h of N a t i o n s

and sub d ue all their adversaries ; an d their secon d that , he

should bestow an independent provision o themselves A s n .

they had generally contributed a good deal to the victory it ,

seemed not unreasonable that they should have some share in

the spoil They were weary besides of humouring the people
.
, , ,

and o f depending upon their caprice for a subsistence I n .

making this demand therefore they consulted their w c ase , , o n

an d comfort without troubling themse lves about the e ffect

,

which it might have in future times upon the influence and

authority f their order The civil magistrate who could
o .
,

comply with this demand only by giving them something which

he would have chosen much rather to take o r to keep to himself , ,

w as seldom very forward to grant it N ecessity however .

, ,

always forced him to submit at last though frequently not till ,

after many delays evasions and aff ected excuses, ,

.

But if politics had never cal l ed in the aid of religion had t he ,

conquering party never adopted the tenets o f o ne sect more

than those of another when it had gained the victory it woul d ,

probably have dealt equally and impartially with all the different
sects and have allowed every man to choose his own priest an d
,

his o wn religion as he thought proper There would in thi s .

case no doubt have been a great multitude of religious sects

, , .

Almost every different congregation might probably have made

a little sect by itse l f or have entertained some peculiar tenets
,

o f its w E ach teacher would no doubt have felt himself

o n .

under the necessity o f making the utmost exertion and of using

every art both to preserve and to increase the number of his
disciples But as every other teacher would have fe l t himse lf
.

under the same necessity the success o f no o ne teacher or , ,

sect of teachers could have been very great The interested

,
.

and active eal of religious teachers can be dangerous and

z

troublesome only where there is either but o n e sect tolerated

i n the so iety or where the whole o f a large society is divided
c ,

i nto two or three great sects ; the teachers of each acting by

concert an d under a regular discipline and subordination But
,
.

that zeal must be altogether innocent where the society is

divided into two o three hundred or perhaps into as many
r ,

thousand small sects of which no one could be considerable ,

enough to disturb the public tranquillity The teachers o f e ach .

sect seeing themselves surrounded o all sides with more a dv er

,
n

sa i
r es than friends would be obliged to learn that candour and
,

moderation which is so seldom to be found among the teachers

o f those great sects whose tenets being su p ported by the civi l ,
 Th e Ex p en s es of t he So v er eig n 2
75
magistrate are held in veneration by almost all the i nhabitants o f
,

extensive kingdoms and empires and w ho therefore see nothing ,

round them but followers disciples and humble admirers The , ,

.

teachers o f ea h little sect finding themselves almost alone

c , ,

would be obliged to respect those of almost every other se c t ,

and the concess ions which they would mutually find it both
convenient and agreeable to m ak e to o another might i ne ,
n

time probably reduce the doctrine of the greater part f them o

t o that pure and rational religion free from every mixture f ,

o

absurdity imposture o fanaticism such as wise men have in

, ,
r ,
:

all ages f the world wished t o see established ; but such as

o

positive law has perhaps never yet established and probably ,

never will establish in any country because with regard t o

,
: ,

religion positiv e law always has been and probably always

, ,

will be more or less in fluenced by popular superstition an d

,

enthusiasm This plan o f ecclesiasti c al government o more

.
,
r

properly f no e c clesiastical government was what the se t alle d

o ,
c c

Independents a se t no doubt o f very wild enthusiasts propose d

,
c ,

to esta blish in England towards the end f the civil war I f o .

it had been established though f a very unphilosophical origin

,
o ,

it would probably by this time have been productive f t h o e

most philosophical good temper and moderation with regard

to eve ry sort Of religious prin ciple It has been esta blished in .

Pennsylvania where though the Quakers happen to be the most

, ,

numerous the law in reality favours no o e sect more than

,
n

another and it is there said to have been productive o f thi s

,

philosophi c al good temper a d moderation n .

But though this equality o f treatment should not be pro

d uc t ie o f this good temper and moderation in all o r even i
v ,
n

the greater part of the religious sects o f a parti ular ountry c c ,

yet provided those sects were sufficiently numerous and each ,

o f them onsequently t o o small to disturb the public tranquillity

c ,

the excessive zeal f each for its particular tenets could not well
o

be produ c tive of any very hurtful e ffects but o the contrary , ,

n ,

of several good ones and if the government w as perfectl y

:

decided both to let them all alone and to o blige them all to let ,

alone o e another there is little danger that they would n t

n , o

o f their w accord subdivide themselves fast enough so as

o n

soon to be ome sufficiently numerous

c .

In every ivilised society in every so iety where the distin tion

c ,
c c

o f ranks has once been ompletely esta blished there have b ee

c ,
n

always t w o different sche mes or systems o f morality current

at the same time ; of which the one may be ca lled the strict o
‘

r
 2
7 6 T he W e al t h o f N at i
On s

a ustere ; the other the liberal o if you will the loose system ,
r, , .

Th former is generally admired and revered by the common

e

p peO le the latter:is c ommonly more estee m ed and adopted by

w hat are alled people o f fashion

c The degree of disapprobation .

w ith which w e ought to mark the vices o f levity the vices whi h ,
c

a e apt to arise from great p ros perity and fro m the excess o f
r ,

g aiety and good humour seems to constitute the prin ipal

,
c

d istinction between those two opposite s hemes o systems In c r .

the liberal o loose system luxury wanton and even disorderly

r , ,

m irth the pursuit of pleasure to some degree of intemperan e

,
c ,

t he breach of chastity at least in one of the two sexes et , ,

c .
,

p rovided they are not a co m panied with gross inde en

c c y and c ,

d o not lead to falsehood or injusti e are generally treated with c ,

a good deal f indulgenc e and are easily either excused

o ,
or

p ardoned altogether In the austere system on

. the contrary , ,

those excesses are regarded with the utmost abhorren e and c

d etestation The vices f levity are always ruinous to the

. o

c ommon people and a single week s thoughtlessness and dis

,
’

sip a t io is often su
n fficient to undo a poor workman for ever ,

and to drive him through despair upon ommitting the most c

e normous crimes The wiser and better sort of the common

.

people therefore have always the utmost abhorren e and

, ,
c

d etestation f su c h excesses which their experience tells them

o ,

are so immediately fatal to people o f their condition The d i s .

o rder and extravagance of several years the contrary will ,

on ,

not always ruin a man of fashion and people o f that rank are ,

ve ry apt to consider the power o f indulging in some degree o f

e xcess as o e of the advantages o f their fortune and the liberty
n ,

o f doing so without censure o r reproach as one of the priv i leges

which belong to their station In people of their own station .

,

t herefore they regard such excesses with but a small degree o f

,

d isapprobation and censure them either very slightly or n o t

,

a t all .

Almost all religious sects have begun among the common

people from whom they have generally drawn their earliest as
,

w ell as their most numerous proselytes The austere system o f .

morality has accordingly been adopted by those sects almost

, ,

c onstantly or with very few exceptions ; fo r there have been

,

some It w the system by which they could best recommend

. as

themselves to that order o f people to whom they first proposed

t heir plan of reformation upon what had been before established .

Many o f them perhaps the greater part o f them , have even

,

c d eav o ur ed t o gain credi t by refining upon this austere system

'

n ,
 Th e E xp en ses of t h e S o v ere ig n
~
2
77
and by carrying it to some degree o f folly and extravaganc e;
and this excessive rigour has frequently recommended them
more than anything else to the respect and veneration o f t he
common p eOp le}
A man f rank and fortune is by his station the distin guishe d
o

member f a great society who attend t eve y part f hi

o ,
o r o s

conduct and w ho thereby oblige him to attend to eve y part

,
r

o f it himself His authority and consideration depend very

.

much upon the respect which this society bears to him He .

dare not do anything which would disgrace discredit him i or n

it and he is obl iged to a very strict observation o f that specie

,
s

o f morals whether liberal o r austere which the general consent

, ,

of this society prescribes to persons o f his rank and fortune A .

man o f lo w condition o the contrary is far from be ing a ,

n ,

distinguished member of any great society While he rema in . s

in a country village his conduct may be attended to and he ,

may be obliged to attend t it himself In this situation and o .

,

in this situation only he may have what is called a characte ,

r

to lose But as soon as he comes into a great city he is sunk in

.

obscurity and darkness His conduct is observed and attended .

to by nobody and he is therefore ve ry likely to neglect it him

,

self and to abandon himself to eve 1y sort o f low p fl ig cy and

,
ro a

vice He never emerges so e ffectually from this obscurity h is

.
,

conduct never excites so much the attention o f any respe table c

society as by his becoming the member o f a small religious sect

, .

He from that moment acquires a degre e o f consideration which

he never had before All his brother sectaries are for the credit
.
,

o f the se t interested to obse r ve his conduct and if he gives

c , ,

occasion to any scandal if he deviates very much from thos e ,

austere morals which they almost always require o f one another ,

to punish him by what is always a ve ry severe punishment even ,

where no civil effects attend it expulsion ex c ommunicatio ,

or n

from the sect In little religious sects accordingly the morals

.
, ,

o f the co mmon people have been al most always remarkably

regular and orderly ; generally much more so than in the
established chur h The morals of those little sects indeed
c .
, ,

have frequently been rather disagreeably rigorous and unso ial c .

There are two very easy and e ffectual remedies however by , ,

whose joint Operation the state might without violen c e orre t , ,

c c

whatever was unso c ial or disagreeably rigorous in the moral s

o f all the little sects into whi h the country was divided c .

The first f those re medies is the study f s ience and philo

o o c

S ophy which the state might render almost universal among a ll

,
278 The W eal t h of N a t i o n s
p eople o f middli g o more than middling
n rank
r an d fortune ;
n o t by giving salaries to teachers m order to make them negligent

a d idle but by institutin g some sort o f probation even in the

n , ,

higher and more difficult s iences to be undergone by eve ry c ,

person before he wa permitted to exercise any liberal p o fe

s r s

s ion or before he could be received as a candidate fo any

,
r

honourable office o f trust or profit If the state imposed upon .

this order o f men the necessity of learning it would have no ,

o ccasion to give itself any trouble about providing them with

proper teachers They would soon find better teachers for
.

themselves than any whom the state could provide fo r them .

Science is the great antidote to the poison o f enthusiasm and

superstition ; and where all the superior ranks o f people were
secured from it the inferior ranks could not be much exposed
,

to t 1 .

The second o f those remedies rs the frequency and gaiety o f

public diversions The state by encoura ing that by giv ing
.
,
g
,
15

entire liberty to all those who for their o w n interest would

attempt without scandal o r indecency to amuse an d divert
, ,

t he people by painting poetry music dancing ; by all sorts f

, , ,
o

dramatic representations and exhibitions would easily dissipate , ,

in the greater part o f them that melancholy and gloomy humour

,

which is almost always the nurse f popular superstition and o

enthusiasm Public diversions have always been the Objects

.

o f dread and hatred to all the fanatical promoters o f those

popular frenzies The gaiety and good humour which those
.

diversions m p ie were altogether incons istent with that temper

s r

o f mind which was fittest for their purpose or which they could ,

best work upon Dramatic representations besides frequently

.
, ,

exposing their a t ific e to public ridicule and sometimes even

r s ,

to public execration were upon that account more than all

, ,

other diversions the Obj ects o f their peculiar abhorrence

, .

In a country where the law favoured the teachers o f no o e n

rel igion more than those o f another it would not be necessary ,

that any o f them should have any particular o immediate r

dependency upon the sovereign o executive power ; o r that he r

should have anything to do either in appointing o in dis r

missing them from their o ffices In such a situation he would .

have no occasion to give himself any concern about them ,

further than to keep the peace among them in the same manner
as amongthe rest f his subjects ; that is to hinder them from
o ,

persecut ing abusing o r Oppressin g o e another But it is

, ,
n .

quite otherwise i n coun t r i es where there is an estab l ished o r

 The Ex p en s e s of t he S o v er e i g n
g overn i ng re l igion The sovereign. ca in this case never be n

s ecure unless he has the means o f i fluencing in a consid e rable n

d egree the greater part Of the teachers o f that rel i gion .

The clergy of every es t a blished church constitute a great

i ncorporation They can act in concert and pursue their interest
.
,

upon one plan and with o n e spir i t as much as if they were under
,

the direction o f o n e man ; and they are frequently t o o under , ,

s uch direction Their interest as an i corporated body 15 never

. n

t he same with that o f the sovere i gn and 15 sometimes directly ,

Opposite to it Their great interest is to maintain their authority

.

with the people and this authority depends upon the supposed
.

c ertain t y and i mportance o f the whole doctrine which they

i nculca te and upon the supposed necessity o f adopting eve ry

,

part o f it with the most implicit faith in order to avoid eternal

‘

m ise ry Should the sovereign have the imprudence t o appear

.

e ither 110 deri d e o r doubt himself o f the most tr iflin g part o f

their doctrin e o r from humanity attempt to protect those who

,

di d either the one o r the other the punctilious honour o f a clergy

,

w h o have no so r t o f dependency upon him is immediately

provoked to proscribe him as a profane person and to employ ,

ll the terrors o f religion in order to ob l ige the people to transfer

a

their allegiance to some more orthodox and obedient prince .

Shou l d he oppose any o f their pretensions o r usurpations the ,

danger is equally great The princes w ho have dared in this

.

manner to rebel against the church over and above this crime of ,

rebellion have generally been charged too with the additional , ,

crime of heresy notwithstanding their solemn protestations o f

,

t heir faith and humble submission to every tenet which she

thought proper to prescribe to them But the authority o f .

r eligion is superior to every other authority The fears which it .

suggests conquer all other fears When the authorised teachers .

Of rel igion propagate through the great body o f the people

doctrines subversive o f the authority of the sovereign it is by ,

violence only by the force o f a sta ndin g army that he can

,
or ,

maintain his authority Even a stand ing army cannot in this

.

case give him any last ing security; because if the soldiers are
not fore igners which can seldom be the case but drawn from
, ,

the great body o f the people which must almost always be the
,

case they are likely to be soon corrupted by those very doctrines

,
.

The revolutions which the turbulence o f the Greek clergy w as

c ontin ually occa sionin g at Constantinople as long as the eastern ,

empire subsisted ; the convu ls i ons which during the course o f ,

several centuries the turbulence o f the Roman clergy w as c o n

,
2 80 Th e W eal t h of N a t i o n s
ti
n u ally occasioning i n every part of Europe uflic ie t ly demon ,
s n

strate how precarious and insecure must always be the situation

of the sovereign who has no proper means o f influencing the
clergy o f the established and governing religion of his country .

Ar ticles f faith as well as all other spiritual matters it i

o , s ,

evident enough are not within the proper department of a

,

t emporal sovereign w ho though he may be very well qualified

, ,

fo protecting is seldom supposed to be so for instructing the

r ,

people With regard to su h matters therefore his authority

. c , ,

can se l dom be su ffi ient to ounterbalance the united authority

c c

o f the clergy o f the established church The public tranquillity .

,

however and his own security may frequently depend upon

, ,

the doctrin es which they may think proper to propagate con

cerning such matters As he can seldom directly Oppose their
.

decision therefore with proper weight and authority it is

, , ,
'

necessary that he should be able to influence it ; and he can

influence it only by t he fe and expectations whi c h he may h
ars

ex ite in the greater part o f the individuals o f the order Those

c .

fears and expectations may consist in the fear of deprivation or

other punishment and in the expectation o f further preferment
, .

In all Christian churches the b e efi es of the clergy are a

.
n c

sort o f freeholds which they enjoy not during ple as ure but , ,

during life o r good behaviour If they held them by a more .

precarious tenure and were liable to be turned o ut upon eve ry

,

slight disobligation either o f the sovereign o o f his ministers r ,

it would perhaps be impossible for them to maintain their

authority with the people who would then consider them as ,

mer enary dependants upon the court in the sincerity of whose

c ,

instru tions they ould no longer have any confidence But

c c .

should the sovereign attempt irregularly and by violence to , ,

deprive any number o f c lergymen o f their freeholds on account , ,

perhaps o f their having propagated with more than ordinary

, ,

zeal some fac tious or seditious doctrine he would only render

, , ,

by such perse ution both them and their do trine ten times
c ,
c

more popular and therefore ten times more troublesome and

,

dangerous than they had been before Fear is in almost all

,
.

cases a wretched instrument o f government and ought in par ,

ti c ula r never to be employed against any order of men w h o

have the smallest pretensions to independen c y To attempt .

to terrify them serves only to irritate their bad hu mour and to ,

confirm them in an Opposition which more gentle usage perhaps

might easily induce them either t o soften or to lay aside alto , .

gether The violence whi h the French government usually

. c
 Th e Ex p en s e s of t h e S o v e r e ig n 281

e mployed m order t o oblige all their parliaments o r sovereign ,

courts o f justice to enregister any unpopular edict very seldom

, ,

succeeded The mea s commonly employed however the 1mn

prisonment of all the refractory members o e would thi

.
, ,

nk were ,
n

forcible enough The princes o f the house o f Stewart so met imm

.

employed the like means in order to influence some o f the

'

members o f the parliament o f Englan d ; and they generally

found them e qually intractable The parliament o f England B .

n o w man aged i another man er ; and a very small expe ri

n ment n
,

whi ch the Duke o f Choiseul made about twelve years ago upon
the parliament o f Paris demonstrated sufficiently that all t he
,

parliaments of Fran ce might have been managed still more

easily in the same manner That experiment was not pursued . .

For though m anagement and persuasion are always the eas ie t s

an d the safest in struments o f government as force and violenc e ,

ar e the worst and the most dangerous yet such it seems i s t he , , ,

n atural ins olence o f man that he almost always d i sdains to use

the good ins trument except when he cannot or dare not use t he
,

bad one The French gove nment could and durst use forc e
. r
,
an d therefore disdained to use management an d persuasion .

But there is no order o f men it appears I believe from t he , , ,

experience o f all ages upon whom it is so dan gerous or rather

, ,

so perfectly rui ous to employ force an d violence as upon t he

n , ,

respe cted clergy o f any esta blished chur h The rights t he c .

,

priv il eges the personal liberty of every individual e c clesias tic

,

w ho is upon good te ms with hi s ow order are even in t he

r n ,

most despotic governments more respected than those o f any ,

other person of nearly equal rank and fortu ne It is so in every .

gradation o f despotism from that of the gentle and mild govern

,

ment of Paris to that of the violent and furious government o f

Consta ntinople But though this order f men can scarce ever
. o

be for ed they may be managed as easily as any other ; and

c ,

the security f the sovereign as well as the public tranquillity

o , ,

seems to depend very mu h upon the means whic h he has o f c

manag ing them ; and those means seem to consist altogether m

the preferment which he has to bestow upon them .

In the ancient constitution of the Christian hurc h the bishop c ,

of each dio ese w as elected by the joint votes of the clergy and
c

of the people of the epis opal ity The people did not long c c .

retain their right f ele tion ; and whil e they did retain it they
o c ,

almost always acted under the influence of the clergy who in ,

such spiritual matters appeared to be their natural guides The .

clergy however soon grew w eary of the trouble o f managing

, ,

11 x
2 82 Th e W eal t h of N at i o n s
them and found it easier t o elect their o w bishops themselves
,
n .

The abbot in the same manner w as elected by the monks o f

, ,

the monastery at least in the greater part of abbacies All the

, .

i nferior ecclesiastical b en efic e comprehended within the diocese

s

w ere collated by the bishop w ho bestowed them upon such ,

ecclesias ti s as he thought proper All church preferments were

c .

i n this manner i n the disposal o f the church The sovereign .

,

though he might have some indirect influence in those elections ,

a d though it was sometimes usual to ask both his consent to

n

ele t and his approbation o f the election yet had no direct o r

c ,

su fficient means of managing the clergy The ambition o f every .

clergyman naturally led him to pay court not so much to his

sovereign as to his o w order from which only he could expect
n ,

preferment .

Through the greater part of Europe the p Op e gradually drew

to himself first the collation o f almost all bishopric and abbacies s ,

or o f what were called Consistorial b efic es and after wards by en , ,

various machinations and pretences o f the greater part o f ,

i nf erior b e efic es comprehended within each diocese ; little

n

more being left to the bishop than what was barely necessary
to give him a decent authority with his own clergy By this .

arrangement the condition of the sovereign was still worse than

it had been before The clergy o f all the d ifferent countries f
. o

E urope were thus formed into a sort of spiritual army d i s ,

p e
r s ed in diff erent quarters indeed but of wh ich
,
all the move ,

ments and operations could now be directed by one head and ,

condu ted upon o e uniform plan The clergy of each parti

c n .

cn lar country might be considered as a parti ular deta chment c

o f that a my f w hi
r c h the Operations could easily be supported
,
o

and seconded by all the other detachments quartered in t he

different c ountries round about Each detachment w as n o t .

only independent o f the sovereign o f the country in which it

was quartered and by which it w as maintained but dependent
, ,

upon a foreign sovereign who could at any time turn its arms
,

against the sovereign of that particular ountry and support c ,

them by the arms of all the other detachments .

Those arms were the most formidable that can well be

imagined In the ancient state of Europe before the estab lish
.
,

ment of arts and manufactures the wealth of the clergy gave ,

them the same sort of influence over the common people which
that o f the great barons gave them over their respective vassals ,

tenants and retainers In the great landed esta tes which the
,
.

mistaken piety both o f princes and private persons had bestowed

 T he Ex p en s e s of t he S o v er e ig n 28
3
upon the church jurisdictions were established o f the same kind
,

with those o f the great barons and for the same reason In ,
.

those great landed estates the clergy their bail iffs ould or c

t ho i
, , ,

e asily keep the peace w i 1t the support as sistance either o f or

the kin g o r o f any other person ; and neither the king nor any
other person could keep the peace there without the support
and ass stance of the lergy The jurisdictions of the c lergy
i c .
,

therefore in their particular baronies o manors were equally

,
r ,

independent and equally exclusive of the authority o f the king s

,
’

courts as those of the great temporal lords The tenants o f

,
.

the clergy were like those of the great barons almost ll

, , a

tenants at will entirely dependent upon their immediate lords

, ,

and therefore liable to be called u t at pleasure in order t o o

fight in any qua rel in whih the lergy might think proper to
r c c

engage them O ver and above the rents of those estates the
.
,

clergy possessed in the tythes a very large portion o f the rents

, ,

o f all the other estates in every kingdom f Europe The o .

revenues arising from both those species f rents were the o

,

g reater part of them paid kind in corn wine ,

attle poultry
111 , , ,
c , ,

etc The quantity exceeded greatly what the clergy could them
.

selves consume ; and there were neither arts nor manufactures

for the produce of which they could exchange the surplus The .

clergy could derive advantage from this im mense surplus in no

o ther w y than by employi g it as the g
a reat barons employed n ,

the lik e surplus o f their revenues in the most profuse h o spitality , ,

and in the most extensive charity Both the hospitality and .

the charity f the ancient clergy accordin gly are said to have
o , ,

been very great They t only maintain ed almost the whole

. no

poor of every kingdom but many knights and gentlemen had ,

frequently no other means o f subsistence than b y travelling

about from mon as tery to monastery under pretence of devotion , ,

but in reality to enjoy the hospitality of the lergy The e c . r

t a ie
n of some particular prelates were Often as numerous as
rs

those o f the greatest lay lords ; and the retainers f all the -

clergy taken together were perhaps more numerous than those , ,

of all the lay lords There w as always much more union among
-

the clergy than among the lay lords The former were under -

a regular discipli e and subordination to the papal authority

n .

The latter were under no regular dis c ipline or subordination ,

but almost always equally jealous f one another and f the o ,

O

king Though the tenants and retain ers of the clergy therefore
.
, ,

had both together been less numerous than those o f the great
lay lords an d their tenants were probably much less numerous
-

, ,
 2 84 The W eal t h of N a t i o n s
yet their union would have rendered them more formidable .

The hospitality and charity o f the clergy t o o not only gave , ,

them the command of a great temporal force but increased ,

very much the weight of their spiritual weapons Those virtue s .

procured them the highest respe t and veneration among all the c

inferior ranks o f people of whom many were constantly and , ,

a lmost all occasionally fed by them Everything belonging o r

,
.

related t o so popular an order its possessions its privileges its , , ,

doctrin es necessarily appeared sacred in the eyes o f the common

,

people and every violation o f them whether real or pretended

, , ,

the highest a t of sacrilegious wickedness and profaneness In

c .

this state o f things if the sovereign frequently found it d iflic ult

,
‘

t o resist the confederacy o f a few o f the great nobility we ,

ca nnot wonder that he should find i t still more so to resist t he

united force f the clergy o f his o w dominions supported b y
o n ,

th at o f the clergy of all the neighbourin g dominions In such .

ci rcumstan es the wonder is not that he was sometimes obliged

c ,

t o yield but that he ever was able to resist

,
.

The privileges o f the clergy those ancient times (which t o 1n

us w ho live m the present times appear the most absurd ) their ,

t o tal exemption from the secular jurisdiction for example or , ,

w hat in England was called the benefit o f clergy were t he ,

na t ural o r rather the necessary consequences o f this state o f

things H w dangerous must it have been fo r the sovereign t o
. o

a ttempt to punish a clergyman for any crime whatever if his ,

ow n order were disposed to protect him and t o represent either ,

the proof as isuflic ie t for convictingso holy a man o r the

n n ,

punishment as too severe to be inflicted upon o e whose person n

had been rendered sa red by religion ? The sovereign could in

c ,

such ircumstances do no better than leave him to be tried by

c ,

t h e ec lesiasti al ourts who for the honour f their own order

c c c , ,
o ,

were interested to restrain as much as possible every member , ,

of it from committing enormous crimes r even from giving ,

o

o c casion to su h gross scandal as might disgust the minds o f

c

the people .

In the state in which things were through the greater part of

Europe during the tenth eleventh twelfth and thirteenth cen , , ,

tu i
r es and fo
,
so me time both before and after that period the
r ,

constitution of the Chur h o f Rome may be considered as the c

most formidable combination that ever was fo med against the r

authority and se urity o f civil government as well as against

c ,

the liberty reason and happiness o f mankind which can flourish

, , ,

o n ly where civil government is able to protect them In that .

 T h e Ex p en s e s of t h e S o v ere ig n 2 85
constitution the grossest delusions of superstition were supported
in such a manner by the private interests f so great a number o

o f people as put the m out o f all danger from any assault o f

human reason because though human reason m ight perhaps

:

have been able to unveil even to the eyes o f the o mmon ,

c

people some f the delusions o f superstition it ould never

,
o ,
c

have dissolved the ties o f private interest Had this o t it u . c ns

tion been attacked by no other enemies but the feeble efforts

o f human reason it must have endured fo ever But that
,
r .

immense and well built fabri whi h all the wisdom and virtue
-

c, c

of m ould never have shaken much less have overturned

an c , ,

was by the natural course o f things first weakened and after , ,

wards in part destroyed and is now likely in the c ourse o f a , ,

few enturies more perhaps to crumble into ruins altogether

c , ,
.

The gradual improvements o f arts manufactures and o m , ,

c

mer e the same uses whi h destroyed the power o f the great
c ,
ca c

barons destroyed in the same manner through the greater part

, ,

o f Europe the whole temporal power f the lergy In the

,
o c .

produce f arts manufactures and commerce the lergy like

o , , ,
c ,

the great barons found somethi g for which they ould ex

,
n c

change their rude produ e and thereby discovered the mean s c ,

Of spending their whole revenues upon their own persons with ,

o u t giving any considerable share f them to other people o .

Their charity became gradually less extensive their hospitality ,

less liberal o less profuse Their retainers became consequently

r .

less numerous and by degrees dwi dled away altogether The

,
n .

clergy too like the great barons wished to get a better rent
, ,

from their landed estates in order to spend it in the same , ,

man er upon the gratification o f their w private vanity and

n ,
o n

folly But this incre as e of rent ould be got only by grantin g

. c

leases to their tenants who thereby beca me in a great mea ure ,

s

independent o f them The ties o f interest which bound the .

inferior ranks f people to the clergy were in this man er

o n

gradually broken and dissolved They were even broken and .

dissolved sooner than those whi h bound the same ranks o f c

people to the great barons be ause the b efic e o f the hurch : c en s c

being the greater part f them much smaller than the estat es
, o ,

o f the great barons the possessor o f each b e efic was much

,
n e

sooner able to spend the whole o f its revenue upon his own
person Duri g the greater part of the fourteenth and fifteenth
. n

centuries the po wer o f the great barons was through the greater ,

part o f Europe in full vigour But the temporal power o f the

,
.

clergy the absolute command which they had once had over the
,
2 86 The W eal t h of N at i o n s
g r ea t the people
b o dy o f was very much decayed The power , .

o f the hur h was by that time ve y nearly redu ed through the

c c r c

greater part of Europe to what arose from her spiritual authori ty ;

and even that spiritual authority was mu h weakened when it c

ceased to be supported by the charity and hospitality o f the

clergy The inferior ranks o f people no longer looked upon
.

that order as they had done before as the comforters o f their

, ,

distress and the relievers of their indigence O the contrary

, . n ,

they were provoked and disgusted by the vanity luxury and , ,

expense f the ri her clergy w ho appeared to spend upon their

o c ,

own pleasures what had always before been regarded as the

patrimony o f the poor .

In this situation f things the sovereigns in the different o ,

sta tes o f Europe endeavoured to recover the i fluence whi h n c

they had once had in the disposal o f the great b e efic e o f the n s

chur h by pro uring to the deans and hapters of each diocese

c ,
c c

the restoration f their ancient right o f ele ting the bishop and
o c ,

to the monks f ea h abba y that o f electing the abbot The

o c c
—
.

re establishing o f this an ient order was the object of several c

statutes enac ted in England during the course o f the fourteenth

c entury parti ularly f what is c alled the Statute o f Provisors
,
c o

and of the Pragmatic sanction established in France in the

fifteenth century In order to render the election valid it was
.
,

necessary that the sovereign should both consent to it before

hand and afterwards approve f the person elected ; and though
,
o

the election w s still supposed to be free he had however all

a , , ,

the indirect means which his situation ne essarily afforded him c

of influencing the lergy in his o w dominions Other regula c n .

tions o f a similar tendency were established in other parts o f

Europe But the power f the pope in the ollation o f the
. o c

great b e efi o f the c hurch seems before the Reformation to

n c es , ,

have been nowhere so e ffectually and so universally restrained

as in France and Eng land The Concordat afterwards in the .
,

sixteenth entury gave to the kings o f France the absolute

c ,

right o f presenting to all the great o what are called the ,

r

consistorial b e efic es o f the Gallican Church

,
n .

Sin ce the establishment o f the Pragmatic sanction and o f the

Concordat the clergy o f France have in general shown less
,

respect to the decrees o f the papal ourt than the clergy o f any c

other Catholic country In all the disputes which their sovereign .

h ashad with the pope they have almost constantly taken ,

party with the former This independency of the clergy f . o

France upon the court o f Rome seems to be principally founded

 Th e Ex p en s e s of t he S o v ere i g n 28
7
upon the Pragmatic sanction and the Concordat In the earlier .

periods o f the monarchy the clergy o f Fran c e appear to have ,

been as much devoted to the pope as those o f any other country .

When Robert the second prince f the Capetian race was most o

unjustly excommunicated by the court of Rome his o w ,

n

servants it is said threw the victuals whi h ame from his

, ,
c c

t able to the dogs and refused to taste anything themselves

,

which had been polluted by the contact of a person in his

situation They were taught to do so it may very safely be
.
,

presumed by the clergy o f his o w dominions

,
n .

The claim f ollating to the great b e efi es of the hurc h

o c n c c ,

a claim in defence of whi h the court of Rome had frequently c

shaken and sometimes overturned the thrones o f some o f the

,

greatest sovereigns in Christendom w as in this ma ner either ,

n

restrained o modified given up altogether in many d ifferent

r ,
or ,

parts o f Europe even before the time Of the Refo rmation As

,
.

the lergy had now less influence over the people so the state
c ,

had more influence over the clergy The c lergy therefore had .
, ,

both less power and less inclination to disturb the state .

The authority f the Church o f Rome was in this state o f

o

d eclension when the disputes which gave birth to the Reform a

tion began in Germany and soon spread themselves through ,

eve y part of Europe The new do trines were everywhere

r . c

received with a high degree f popular favour They were p o . ro

p g
a a t d with
e all that enthusiasti zeal whi h ommonly animates c c c

the spirit Of party when it attac ks established authority The .

t ea hers o f those do trines though perhaps in other respects

c c ,

not more learned than many of the divines wh defended o

t he established church seem in general to have been better ,

acquainted with ecclesiastical history and with the origin and ,

progress of that system o f opinions upon whi h the authority c

o f the chur h was established c and they had thereby some ,

advantage in almost every dispute The austerity of their .

manners gave them authority with the common people who ,

contrasted the strict regularity o f their conduct with the dis

orderly lives o f the greater part of their o w clergy They n .

possessed too in a much higher degree than their a dversaries

, ,

all the arts of popularity and of gaining proselytes arts whi h ,

c

the loft y and dignified sons f the church had long neglected o

as being to them m a great measure useless The reason of the .

new doctrin es re ommended them to some c their novelty t o ,

many ; the hatred and ontempt of the established clergy to a c

stil l greater number ; but the zealous p as sionate and fanatical , , ,

2 88 The W eal t h of N at i o n s
though frequent l y coarse and rustic eloquence with which the y ,

were almost everywhere inculcated reco mmended them to by ,

far the greatest number .

The suc ess o f the new doctrines w as almost everywhere so

c

great that the prin es who at that t ime happened to be o bad

c n

terms with the court of Rome were by means o f them easily

enabled in the i r o w dominions to overturn the chur h which
,
n ,
c , ,

ha vin g lost the respect and veneration o f the inferior ranks o f

people could make scarce any resistance The court of Rome
,
.

had disobliged some o f the smaller princes in the northern parts

o f Germany whom it had probably considered as too insignificant
,

to be worth the managing They universally therefore esta b .

, ,

li sh ed the Reformation their o w dominions The tyranny 1n n .

of Chr it i II and o f Troll Ar hbishop o f Upsal enabled

s ern . c ,

Gustavus Vasa to expel them both from Sweden The pope .

favoured the tyrant and the archbishop and Gustavus Vasa ,

found no difficulty in es t ablishing the Reformation in Sweden .

Ch it i r s
e II w afterwards deposed from the thr one o f
rn . as

Denm ark where his conduct had rendered him as odious as in

,

Sweden The pope however w as still disposed to favour him

.
, , ,

an d Frederick f Holstein who had mounted the throne in hi

o s ,

s t ead revenged himself by following the example f Gustavus

,
o

Vasa The magistrates o f Berne and Z uri h who had no

. c ,

p rticular quarrel with the pope esta blished with great ease
a ,

the Reformation in their respe tive cantons where just before c ,

s ome o f the lergy had by an imposture somewhat grosser than

c ,

ordinary rendered the whole order both odious and contemptible

,
.

In this critical situation o f its affairs the papal court was ,

a t su fficient pains to cultivate the friendship of the powerful

so vereigns o f France and Spain of whom the latter w a s at that ,

time Emperor o f Germany With their assistance it was enabled .

,

t hough o t without great difficulty and much bloodshed either

n ,

to suppress altogether o to obstruct very much the progress r

o f the Reformation in their domin ions It was well enough .

in clined t o o to be complaisant to the King o f England But

, ,
.

from the circ umstances o f the times it could not be so without ,

giving offence to a still greater sovereign Charles V King o f ,

.
,

Spain and Emperor o f Germany Henry VIII accordingly . .

,

though he did not embrace himself the greater part o f the

doctrines of the Reformation was yet enabled by their general , ,

prevalence to suppress all the monasteries and to abolish the

, ,

a uthority o f the Church o f Rome in his dominions That he .

sh ould go so far though he went no further gave some sat is

, ,
 The Ex p en s e s of t h e S o v e r e i g n 2 89

faction to the patrons of the Reformation who having got ,

possession o f the government in the reign o f his son and successor ,

completed without any difficulty the work which Henry VIII .

had begun .

In some ount ries as in Scotland where the government was

c , ,

weak unpopular and not very firmly established the Reforma

, , ,

tion w as strong enough to overturn not only the church but , ,

the state likewise for attempti g to support the church n .

Among the followers of the Reformation dispersed in all the

d ifferent countries o f Europe there was no general tribunal ,

whih like that of the court o f Rome o an oecumenical coun il

c , ,
r c ,

could settle all disputes among them and with i resistible ,

r

authority pres ribe to all o f them the precise limits f orthodoxy

c o .

When the followers of the Reformation in one country therefore , ,

happened to differ from their brethren in another as they had ,

no comm on judge to appeal to the dispute could never be ,

decided ; and many su h d isputes arose among them Those c .

concerning the government o f the hurch and the right o f c ,

conf erring ecclesias ti al b efic e were perhaps the most interest

c en s,

ing to the peace and welfare of civil society They gave birth .

accordin gly to the t w o principal parties o f sects among the

followers o f the Reformation the Lutheran and Calvinisti sects ,
c ,

the only sects among them o f which the doct rine and disciplin e
have ever yet been established by law in any part of Europe .

The followers o f Luther together with what is called the ,

Church of England preserved more o less f the episcopal ,

r o

government established subordin ation among the clergy gave

, ,

the sovereign the disposal f ll the bishopri s and other o a c con

s it o il b
s r a fi within his dominions and thereby rendered
en e c es ,

hi m the real head f the hurch ; and without depriving the o c

bishop f the right f collating to the smaller b e fic es within

o o ne

hi s diocese they even to those b fi s not only admitted

, ,
en e ce , ,

but favoured the right o f presentation both in the sovereign and

in all other lay patrons This system f c hurch government
-
. o

was from the beginning favourable to peace and good order ,

and t o submission to the ivil sovereign It has never a cord c .

,
c

ing ly been the o c casion o f any t umult o

,
ivil ommotion in any r c c

country in whih it has on e been established The Chur h o f

c c . c

E n gland in particular has always valued herself with great ,

reas on upon the unex eptionable loyalty o f her prin iples

,
c c .

Under su h a government the lergy naturally endeavour t o

c c

re ommend themselves to the sovere ign to the court and t o

c , ,

the nobi lit y and gentry of the count y by whose influence they r ,

11 K 2
2
9 0 The W eal t h of N a t i o n s
chiefly expect to obtain preferment They pay court to those .

patrons sometimes no doubt by the vilest flattery and assenta

, ,

tion but frequently too by cultivating all those arts which best
, , ,

dese rve and which are therefore most likely to gain them the
,

esteem o f people o f rank and fortune ; by their knowledge in all

the different branches of usefu l and ornamental learning by ,

the decent liberality o f their manners by the social good hu mour ,

o f their c onversation and by their avowed contempt o f those ,

a bsurd and hypo ritical austerities which fanatics inculcate and

c

pretend to practise in order to draw upon themse lves the ,

veneration and upon the greater part o f men of rank and

,

fortune w ho avow that they do not practise them the abhor

, ,

rence of the common people Such a clergy however while .

, ,

they pay their court in this manner to the higher ranks o f life ,

ar e very apt to neglect altogether the means f maintaining o

their influence and authority with the lower They are listened .

to esteemed and respecte d by their superiors ; but before their

, ,

inferiors they are frequently incapable o f defending e ffectually ,

an d to the onviction o f such hearers their own sober and

c ,

moderate doctrines against the most ignorant enthusiast who

chooses to attack them .

The followers o f Z uiglius o r more properly those o f Calvin n , ,

on the contrary bestowed upon the people of each parish when

, ,

ever the chur h be ame va ant the right o f electing their o w

c c c ,
n

pas tor and established at the same time the most perfe c t
,

equality among the clergy The former part o f this institution .

,

as long as it remained in vigour seems to have been productive ,

of nothing but disorder and c onfusion and to have tended ,

equally t o corrupt the morals both of the lergy and o f the c

peo ple The latter part seems never to have had any e ffects
.

but what were perfectly agreeable .

As long as the people o f each parish preserved the right f o

ele ting their

c w pastors they a ted almost always under the
o n ,
c

influence of the clergy and generally of the most factious and ,

fanatical o f the order The clergy in order to preserve their .

,

influence in those popular elections be ame o affe c ted to ,

c ,
r

become many o f them fanatics themselves encouraged fa at i

, , ,
n

cis m among the people and gave the preference almost always ,

to the most fanatical andidate So small a matter as the c .

a ppointment o f a parish priest occasioned almost always a

violent contest o t only in one parish but in all the neighbour

,
n ,

in g parishes who seldom failed to take part in the quarrel

,
.

When the parish happened to be situated in a great city it ,

 T h e Ex p en s e s of t h e S o v e r e ig n 29 1

divided all the inhabitants into two parties ; and when that city
happened either to onstitute itself a little republic or to be c ,

the head and capital of a little republi c as is the ase with many ,
c

o f the co siderable cities in Switzerland and Holland

n every ,

paltry dispute o f this kind over and above exasperating the ,

animosity f all their other fa tions threatened to leave behind

o c ,

it both a new schism in the hur h and a new fa tion in the c c ,

c

state In those small republi c s therefore the magistrate very

.
, ,

soon found it ne essary for the sake f preservin g the publi c

c ,
o

peace to assume to himself the right o f presenting to all vacan t

,

b e efic es
n In Scotland the most extensive ountry in whi c h
.
,
c

this Presbyterian form of church government h ever been as

established the rights f patronage were in effect abolished by

,
o

the act which establ ished Presbytery in the beginning of the

reign of William III That act at least put it in the power o f .

certain classes f people in each parish to purchase for a very

o ,

small price the right of electing their o w pastor The o

,
n . c n

st it ut i
o whih this t establ ished was allowed to subsist fo r
n c ac

about t wo and twenty years but w as abolished by the th of

- -

,
ro

Queen Ann e ch account of the confusions and disorders

,
. 1 2, o n

which this more popular mode of election had almost every

where occasioned In so extensive a country as Sco tland .
,

however a tu mult 111 a remote parish w as not so likely to give

,

d isturbance to government as i a smaller state The th of n . ro

Queen Anne restored the rights of patronage But though in .

S otland the law gives the b efi without any exception to

c en ce

the person presented by the patron yet the church requires ,

sometimes (fo she has not in this respect been very uniform
r 1n

her decisions ) a certain con urren e f the people before she c c o

will confer upon the presentee what is ca lled the ure of souls c ,

or the ec lesiasti l jurisdiction i the parish She sometimes

c ca n .

a t least from an affected con ern for the pe ace

,
f the parish c o ,

delays the settlement till this con urren e can be procured c c .

The private tampering o f some o f the neighbouring lergy c ,

sometimes t o procure but more frequently to prevent this , ,

concurren e and the popular arts whih they cultivate order

c ,
c 1n

t o enable them upon su h o asio n s to tamper more effectually c cc ,

are perhaps the causes whi h principally keep up whatever c

remains o f the o ld fa atical spirit either the clergy or in the n ,

1n

people o f Scotlan d .

The equality which the P resbyterian form of church govern

ment es tablis hes among the lergy c o ists fi st in the equality c ,
ns ,
r ,

o f authori t y o ecclesiastical jurisdiction ; and secondl y ln the

r , ,
292 Th e W e al t h of N at i o n s
equality o f b efic e In all Presbyterian churches the equality
en .

o f authority is perfect that o f b efic e is o t so The d ifferenc e

: en n .
,

however between o e b e fic e and another is seldom so o

,
n ne c n

si d e b l as ommonly t tempt the possessor even f the small

ra e c o o

one to pay ourt to his patron by the vile arts of flattery and
c

assentation in order to get a better In all the P resbyterian .

chur hes where the rights o f patronage are thoroughly estab

c ,

li sh d it is by nobler and better arts that the established clergy

e ,

in general endeavour to gain the favour of their superiors ; by

their learning by the irreproa hable regularity of their life and
,
c ,

by the faithful and diligent discharge o f their duty Their .

patrons even frequently complain f the independen y o f their o c

S pirit which they are apt to

,
onstrue into ingratitude for past c

favours but which at worst perhaps is seldom any more than

, , ,

that indifference which naturally arises from the consciousness

that no further favours o f the kind are ever to be expected .

There is s ar e perhaps t o be found anywhere in Europe a more

c c

learned decent independent and respectable set o f me than

, , ,
n

the greater part o f the Presbyterian clergy of Holland Geneva , ,

Switzerland and S otland ,

c .

Where the c hurch b e fic s are all nearly equal none o f them ne e ,

can be very great and this mediocrity f b e efic e though it may

,
o n ,

no doubt be carried t o o far has however some very agreeable , , ,

e ffects N othing but the most exemplary morals c give

. an

dignity to a ma o f s mall fortune The vi es f levity and vanity

n . c o

necessarily render him ridiculo us and are besides almost as , , ,

ruinous to him as they are to the co mmon people In his o w . n

conduct therefore he is obliged to follow that system of morals

, ,

whi h the common people respe c t the most He gains their

c .

esteem and affection by that plan o f life which his o w interest n

and situation would lead him to follow The common people .

look upon him with that k indness with whic h w naturally e

regard e who approa hes somewhat to o u own condition but

on c r ,

who w e think ought to be in a higher

, ,
Their kindness naturally .

provokes his kindness He be omes careful to instru t them . c c ,

and attentive to assist and relieve them He does not even .

despise the prejudi es of people who are disposed to be so c

favourable to him and never treats them with those c ,

on

t emp t u o u s and arrogant airs whi h we so often meet with in c

the proud dignitaries o f Opulent and well endowed churc hes -

The Presbyterian clergy accordingly have more influence over , ,

the minds of the common people than perhaps the clergy o f

any other established hurch It is ac cordingly in P resbyterian c .
 T h e Ex p en s e s of t he S o v er e ig n 2
93
countries only that we ever find the common people onverted c ,

without persecution ompletely and almost to a man to the ,

c , ,

established hur h c c .

In ountries where hur h b fi are the greater part o f

c c c en e c es

them very moderate a hair in a university is generally a better

,
c

establishment than a hur h b e fi The universities have c c ne ce .

,

in this ase the pi king and hoosing of their members from all
c ,
c c

the chur hmen f the country w ho in every ountry onstitute

c o , ,
c ,
c

by far the m ost numerous c lass o f men f letters Where chur h o . c

b e efic e
n the contrary are many of them very considerable
s, o n , ,

the chur h naturally draws from the universities the greater

c

part o f their eminent men of letters who generally find some ,

patron who does himself honour by procuring them chur h c

preferment In the former situation we are likely to find the

.

universities filled with the most eminent men of letters that are
to be found in the ountry In the latter we are likely to find
c .

few eminent men among them and those few among the youngest ,

members o f the so iety w h are likely t o to be drained away

c ,
o ,
o,

from it before they have acquired experien e and know c an c

ledge enough to be o f much use to it It is observed by Mr . .

de Voltaire that Father P é e a Jesuit f no great eminence

,
o rr ,
o

in the republi of letters was the only professor they had ever
c ,

had in Fran e whose works were worth the read ing In a

c .

country which has produ ed so many e minent men o f letters c

f t hen i
,

it must appear somewhat s ingular that scarce o ne o

should have been a professor in a university The famous .

Gassendi was in the beginning f his life a professor in the

,
o ,

University of Aix Upon the first daw ing f his genius it w as

. n o ,

represented to him that by go ing i to the hurch he ould easily n c c

find a much more quiet and omfortable subsisten e as well as c c ,

a better situation for pursui g his studies ;a d he immediately n n

followed the advice The observation o f Mr de Voltaire may. .

be applied I believe not only to France but to all other Roman

, , ,

Catholic countries We very rarely find in any of them an

.
, ,

emi ent man f letters w h is a professor in a university ex ept

n o o ,
c ,

perhaps in the professions f law and physi ; professions from

,
o c

whi h the hur h is o t so likely to draw them After the

c c c n .

Church of Rome that of England is by far the ri hest and best

,
c

endowed chur h in Christendom In England accordingly

c .
, ,

the hurch is continually draini g the universities o f all their

c n

best and ablest me mbers ; and an old ollege tutor who is c ,

known and distinguished in Europe as an eminent man o f letters ,

is as rarely to be found there as in any Roman Catho lic ountry c .

2
94 Th e W e al t h of N a t i o n s
In Geneva o n the contrary in the P rotestant cantons o f Switzer
, ,

land i the P rotestant ountri es o f Germany in Holland in

,
n c , ,

Scotland in Sweden and Denmark the most emin ent men o f

, , ,

letters whom those ountries have produced have not all c , ,

indeed but the far greater part o f them been professors in

, ,

universities In those countries the universities are continually

.

draining the church of all its most emin ent men o f letters .

It may perhaps be worth while to remark that if we ex ept

, , ,
c

the poets a few ora tors and a few historians the far greater
, , ,

part o f the other eminent men o f letters both o f Greece and ,

Rome appear to have been either public o private teachers ;

, r

generally either o f philosophy o o f rhetoric This remark will r .

be found to hold true from the days o f Lysias and Isocrates ,

of Plato and Aristotle down to those o f Plutarch and Epictetus , ,

o f Suetonius and Quintilian To impose upon any man the .

necessity o f teachin g year after year any particular branch o f , ,

science seems in ealit y t o be the most e ffectual method fo r

‘

, ,
r ,

rendering him completely master o f it himself By being obliged .

t o go every year over the same ground if he is good for anything , ,

he necessarily becomes in a few years well acquainted with , ,

every part o f it and if upon any particular point he should

:

form t o o hasty an opinion o year when he comes in the course ne ,

o f his lectures to reconsider the same subject the year there

after he is very likely to correct it As to be a teacher o f

,
.

science is certainly the natural employment of a mere man f o

letters so is it likewise perhaps the education which is most

, , ,

likely to render him a man o f solid learning and knowledge .

The mediocrity o f church b e efic es naturally tends to draw the n

greater part o f men of letters in the country where it takes ,

place to the employment in which they can be the most useful

,

to the public and at the same time to give them the best
, , ,

education perhaps they are capable of receiving It tends to

, , .

render their learning both as solid as possible and as useful as ,

possible .

The revenue o f every established church such part s o f it ,

excepted as may arise from particular lands o manors is a r ,

branch it ought to be observed o f the general revenue o f the

, ,

state which is thus diverted to a purpose very different from

the defence o f the state The tythe for example is a real land .
, ,

tax which puts it o ut o f the power o f the proprietors o f land to

,

c ontribute so largely towards the defen e of the state as they c

otherwise might be able to d o The rent of land however .

, ,

is according to some the sole fund and according to others

, , , , ,
 T he Ex p e n s es of t he S o v er ei g n 295

the principal fund from which in all great monarchies the

, , ,

exigencies of the state must be ultimately supplied The more .

o f this fund that is given to the church the less it is evident , , ,

can be pared to the state It may be laid down as a c ertain

S .

max im that all other things being supposed equal the richer
, ,

the church the poorer must necessarily be either the sovereign

, ,

on the one hand or the people o n the other ; and in all cases
, , ,

the less able must the state be to defend itself In several .

Protestant countries particularly in all the Protestant cantons

,

of Swit z erland the revenue which anciently belonged to t he

,

Roman Catholic Church the tythes and church lands has been , ,

found a fund su fficient not only to afford competent salaries ,

to the established clergy but to defray with little or no addition , , ,

all the other expenses f the state The magistrates of the o .

powerful canton o f Berne in particular have accumulated o ut , ,

o f the savings from this fund a very large sum supposed t o ,

amount to several millions part o f which is deposited in a public ,

treasure and part is placed at interest in what are called the

,

public funds f the different indebted nations o f Europe chiefly

o

in those o f France and Great Britain What may be the amount .

of the whole expense which the church either of Be rne r o f , ,

o

any other Protestant canton costs the state I do not pretend , ,

to know By a very exact account it appears that in 75 5

.
,
1 ,

the whole revenue of the clergy o f the Chur c h o f Scotland ,

including their glebe or church lands and the rent f their ,

o

manses or dwelling houses estimated according to a reasonabl e

-

valuation amounted only to £6 5 4

,
8 —
s d This ve ry ,
1 I S .
l
TQ
-

moderate revenue affords a decent subsisten e to nine hundred c

and forty four ministers The whole expense of the church

-

.
,

including what is occasionally laid out fo the building and r

reparation o f churches and f the manses of ministers cannot

,
o ,

well be supposed to exceed eighty o eighty fi e thousand pounds r -

v

a year The most opulent hurch in Christendom does o t

. c n

maintain better the uniformity of faith the fervour f devotion ,

o ,

the spirit of order regularity and austere morals in the great

, ,

body of the people than this very poorly endowed Chur h o f

,
c

Scotland All the good effe c ts both civil and rel igious which
.
, ,

an established c hurch a be supposed to produce are produ ed

c n ,
c

by it as completely as by any other The greater part o f the .

Protestant churches o f Switzerland which i general are not ,

n

better endowed than the Church of Scotland produce those e ffect s ,

in a still higher degree In the greater part of the Protestant .

cantons there is not a s ingle person t o be found who does not

2
9 6 T he W e al t h of N at i o n s
profess himself t o be o f the established church If he professes .

himself to be f any other indeed the law obliges him to leave

o , ,

the canton But so severe or rather indeed so Oppressi e a

.
,
v

la w could never have been executed i

, n such free countri es

had not the diligence o f the clergy beforehand converted to

the established church the whole body o f the people with the ,

exception of perhaps a few individuals only In some parts

, ,
.

o f Switzerland a c cordingly where from the accidental union

-

, , ,

of a P rotestant and Roman Catholic country the conversion has ,

not been so complete both religions are not only tolerated but
,

established by law .

The proper performance of every service seems to require

that its pay o r recompense should be as exactly as possible , ,

proportioned to the nature f the service If any service is o .

ve ry much underpaid it is very apt to suffer by the meanness

,

and incapacity of the greater part o f those who are empl o yed
in it If it is very much ov erpaid it is apt to su ffer perhaps
.
, , ,

still more by their negligence and idleness A man f a large . o

revenue whatever may be his profession thinks he ought to

, ,

live like other men o f large revenues and to spend a great part ,

of his time in festivity in vanity and in dissipation But in , ,

.

a clergyman this train of life not only consumes the time which
ought to be employed in the duties o f his function but in the ,

eyes o f the common people destroys almost entirely that sanct i ty

of character whi c h can alone enable him to perform those duties
with proper weight and authority .

PA RT I V
0/ the E xpen s e o f su pp o r ti
n g t he Di
g y
n i
t o f the S o ver ei
gn

Over and above the expenses necessary for enabling the sove
reign to perform his several duties a certain expense is requisite ,

for the support of his dignity This expense varies both with
’

the different periods o f improvement and with the different ,

forms o f government .

In an Opulent and improved society where all the different ,

orders o f people are growing every day more expensive in their

houses in their furniture in their tables in their dress and in
, , , ,

their equipage it cannot well be expected that the sovereign

,

should alone hold out against the fashion He naturally there .

,

fore o rather necessarily becomes more expensive in all those

,
r ,

different articles too His dignity even seems to require that

.

he should become so .
 Th e Ex p en s e s o f t h e So v e r e ig n 2
97
As in point f dignity a monarch is more raised above his
o

subjects than the chief magistrate of any republic is ever

supposed to be above his fellow citizens so a greater expense -

is necessary for supporting that higher dignity We naturally .

expect more S plendour in the court of a king than in the

mansion house of a doge o r burgomaster
-

C O N C LU S I O N
The expense o f defend ing the society and that Of supportin g ,

the dignity of the chief magistrate are both laid o u t for the ,

general benefit Of the whole society It is reasonable there .

,

fore that they should be defrayed by the general contribution

,

o f the whole society all the di ff erent members contributin g as

, ,

nearly as possible in proportion to their respe tive abilities

,
c .

The expense f the administration o f justice t o o may no

o , , ,

doubt be considered as laid ut for the benefit f the whole

,
o o

society There is no impropriety therefore in its being defrayed

.
, ,

by the general contribution f the whole society The persons o .

,

however who give occasion to this expense are those who by

, ,

their injustice in o e w ay r another make it necessary to seek

n o ,

redress or protection from the courts o f justi c e The persons .

again most immediately benefited by this expense are those

whom the courts f justice either restore to their rights o r
o

maintain in their rights The expense f the administration f . o o

justi e therefore may very properly be defrayed by the parti

c , ,

c ul contributio no f one o other r both o f those two different

ar r ,
o ,

sets of persons according as different occasions may require

, ,

that is by the fees o f court It cannot be necessary to have

, .

recourse to the general contribution o f the whole society except ,

for the conviction o f those criminals wh have not themselves o

any estate o fund sufficient for paying those fees

r .

Those local o provincial expenses o f which the benefit is

r

local o r prov incial (what is laid out for example upon the poli e , ,
c

o f a particular town district ) ought to be defrayed by a local

or

or provincial revenue and ought to be no burden upon the ,

general revenue o f the so iety It is unjust that the whole c .

society should contribute towards an expense o f which the

benefit is confined to a part of the society .

The expense of maintaining good roads and ommuni ations c c

is no doubt beneficial to the whole society and may therefore

, , , , ,

thout any injusti e be defrayed by the general ontribution

c ,
c

o f the whole society This expense however is most imme

.
, ,
2
9 8 Th e W eal t h of N a t i o n s
a t ely and
di dire tly benefi ial to those who travel r carry goods
c c o

fro m o e pla e to another and to those wh consume such

n c ,
o

goods The turnpike tolls in England and the duties c alled

.
,

peages in other countries lay it altogether upon those t w o ,

different sets of people and thereby dis harge the general ,

c

revenue o f the so iety from a very considerab l e burden

c .

The expense of the institutions for education and religious

inst u tion is likewise no doubt beneficial to the whole society
r c , , ,

and may therefore without injustice be defrayed by the

, , ,

general contribution of the whole society This expense how .

,

ever might perhaps with equal proprie t y and even with some
, ,

a dvantage be defrayed altogether by those who receive the

,

immediate benefit f such education and instruction o r by t he

o ,

voluntary ontribution of those who think they have occasion

c

for either the one o the other r .

When the ist it ut io s o r public works which are beneficial t o

n n __

the whole society either cannot be maintained altogether or ,

are o t maintained altogether by the contribution o f such

n

parti ular members of the so c iety as are most immediately

c

benefited by the m the defi ien y must in most cases be made

,
c c

up by the general contribution Of the whole society The .

general revenue f the society over and above defraying t he

o ,

expense f defending the society and of supporting the dignity

o ,

of the chief magistrate must make up for the defi c iency o f many ,

parti ular bran hes of revenue The sources of this general o r

c c .

publi revenue I shall endeavour to explain in the following

c

chapter .

CHAPTER II
OF THE S O U R CE S OF THE GE N RAL E O R P UB L I C RE VE NU E

OF THE S O C I E TY
THE revenue which must defray not only the expense of ,

defending the society and o f supporting the dignity Of the

chief magistrate but all the other necessary expenses o f govern
,

ment fo which the onstitution of the state has not provided

r c

any parti ular revenue m y be drawn either first from some

c ,
a , ,

fund w hich peculiarly belongs to the sovereign or common

wealth and which is independent of the revenue o f the people ;
,

o r secondly from the revenue of the people

, ,
.
 Th e So u r c es of R ev en u e 299

PA RT I

Of the F u n ds o r ch may pec u li

S o u r ces of Reven u e whi arly belo n g

t o the S over ei n o r Co mmo n w ealth

g
The funds o sources o f revenue which may pe c uliarly belon g
r

to the sovereign or commonwealth must onsist either in sto k c c

o in land
r .

The sovereign like any other owner o f stock may derive a , ,

revenue from it either by e mploying it himself or by lendin g, ,

it His revenue is in the o e case profit in the other interest

. n ,
.

The revenue Of a Tarta r o r Arabian chief onsists in profit c .

It arises principally from the milk and in rease of his own herd s c

and flocks o f which he himself superintends the management

, ,

and is the principal shepherd herdsman o f his o wn horde r or o

tribe It is however in this earliest and rudest sta te of ivil

.
, ,
c

government only that profit has ever made the principal part
of the public revenue o f a monarchical state .

Small republi s have sometimes derived a onsiderable revenue

c c

from the profit o f mercantile projects The republic f Ham . o

burg is said to do so from the profits Of a public wine cella r

and apothecary s shop The state cannot be very great f ’

.
1
o

which the sovereign has leisure to rry o the trade f a wi e ca n o n

merc hant o apothecary The profit of a public bank has been

r .

a source o f revenue to more considerable states It has bee . n

so o t o n ly to Hamburg but t o Veni e and Amsterdam A

n ,
c .

revenue of this kind has even by some people been thought not
below the attention f so great an empire as that f Great o o

Brita in Re konin g the ordinary dividend f the Ba k o f Eng

. c o n

land at five and a half per c ent and its pita l at ten million . ca s

seven hundred and eighty thousand pounds the net an ual ,

n

profit after payi g the expense o f management must am ount

,
n , ,

it is said to five hundred and n ine t y two thousand nine hundred

,
-

pounds Government it is pretended could borrow this capita l

.
, ,

at three per cent interest and by taking the management o f .

,

S M m i D i t I mp iti p t m i
1
ee t l et E
o res c o ncerna n es ro s e os o ns en u ro e, o e
p g 7 3 Th i w k w m pil d by t h d f th
.

a e s or t f th f
as c o e e or er o e c o ur or e u se o
mm i i mpl y d f m y p t i d i g th p p
.

a co ss o n e i o e or so e ear s as n con s er n e ro er
m f
ean s f mi g t h fi
o r re o r f F Th t n f th F h e n an c e s o r an c e e a c co un o e r en c
t x whi h t k p th v l m i q t m yb g d d p
.

a es, c a es u r ee o u es n u ar o , a e re ar e as er
f t ly
ec th ti Th t f t h
au f th
en E pc ti w m pil d
a o o se o o er ur o e an n a on s as c o e
f m h i f m ti F h mi it t t h diff t
.

ro s uc th n or a t
ons as e r en c n s er s a e er en co ur s
co u ld p It i m h h t
r o c ur e d p b bly t q i t x t
s uc s o r er , an ro a no u e so e ac as
h F h x
.

t at o f t he r en c ta es .
300 Th e W e al t h o f N at i o n s
the bank into its own hands might make a c lear profit of two ,

hundred and sixty nine thousand five hundred pounds a year

-

The orderly vigilant and parsimonious ad ministration of such

, ,

aristocra ies as those f Veni c e and Amsterdam is extremely

c o

proper it appears from experien e f the management o f a

,
c ,
or

mercantile proje t o f this kind But whether such a govern

c .

m ent as that f England— whi c h whatever may be its virtues

o , ,

has never been fam ous for good economy ; whi h in time of c ,

pea e has generally condu ted itself with the slothful and
c ,
c

negligent profusion that is perhaps natural to monar hies and c

i time o f war has onstantly acted with all the thoughtless

n c

extravagance that democracies are apt to fall into—could be

safely trusted with the management of such a project must at ,

least be a good deal m ore doubtful .

The post flfic e is properly a mercantile project The govern

O .

ment advances the expense of establishing the different o ffices ,

and o f buying o hiring t he necessary horses or carriages and

r ,

i repaid with a large profit by the duties upon what is carried

s .

It is perhaps the only mer antile proje t which has been suc c c

c essfu lly managed by I believe every sort o f government ,

The ,
.

capital to be advan ed is not very onsiderable There is no

c c .

m ystery in the business The returns are not only certa in .

,

b u t immediate .

Princes however have frequently engaged in many other

, ,

m ercantile proje ts and have been willing like private persons

c , , ,

to mend their fortunes by beco ming adventurers in the common

b ran hes o f trade
c They have scarce ever suc eeded The
. c .

profusion with whi h the affairs of princes are always managed

c

renders it almost impossible that they should The agents of .

a prince regard the wealth o f their master as inexhaustible ; are

c areless at w hat price they buy ; are careless at what pri e they c

s ell ; are areless at what expense they transport his goods from
c

one place to another Those agents frequently live with the .

p rofusion o f prin es and sometimes t o

c in spite
,
Of that p o o r

fusion and by a proper method f making up their accounts

,
o ,

a cquire the fortunes o f prin es It was thus as we are told by c .

,

Machiavel that the agents f Lorenzo f Medi is not a prince

,
o o c ,

o f mean abilities arried on his trade The republic of Florence

,
c .

w s several times obliged to pay the debt into which their

a

extravagance had involved him He found it onvenient c . c ,

a

c o d ig
r ly to give up the business o f mer c hant the business to
n , ,

whi c h his family had originally owed their fortune and in the ,

latter part f his life to employ both what remained f that

o o
 Th e S o u r c e s o f R e ven u e 30 1

fortune and the revenue o f the state o f which he had the

,

disposal in projects and expenses more suitable to his s t ation

,
.

N O t wo haracters seem more inconsistent than those o f

c

trader and sovereign If the tradin g spirit o f the English East .

India Company renders them very bad sovereigns the spirit f ,

o

sovereignty see m s to have rendered them equally bad traders .

While they were traders only they managed their trade su ess cc

fu lly and were able to pay from their profits a moderate dividend
,

to the proprietors o f their stock Sin e the y be ame sovereigns . c c ,

with a revenue whi h it is said was origin ally more than thre e
c , ,

millions sterling they have been obliged to beg the extraordinary

,

as sistance f government in order to avoid immediate bank

o

r up t c y .In their former situation their servants in India ,

con

si de ed themselves as the lerks o f mer hants in their present

r c c :

situation those servants consider themselves as the ministers

,

of sovereigns .

A state may sometimes derive so me part of its pub lic revenue

from the interest f money as well as from the profits f stock
o ,
o .

If it has amassed a treasure it may lend a part f that treas ure ,

o

either to foreign states t its o w subjects ,

or o n .

The canton f Be m e derives a considerable revenue by lend

o

ing a part o f its treasure to foreign states ; that is by pla ing ,

c

it in the public funds o f the different indebted nations o f Europe ,

chiefly in those f France and England The se urity f thi

o . c o s

revenue must depend first upon the security of the funds i , ,

n

which it is plac ed or upon the good faith o f the government

,

which has the management f them ; and se ondly upon the o ,

c ,

certa inty o probabilit y f the continuance of peace with the

r o

debtor nation In the ase f a war the very first act o f

. c o ,

hostility on the part of the debtor nation might be the fo

, ,
r

fei tu re o f the funds f its creditor This policy o f lending o .

money to foreign s t ates is so far as I know peculiar to the , ,

can ton f Berne o .

The city of Hamburg has established a sort f publi c 1

o

pawnshop which lends money to the subj ects o f the state upon
,

pledges at six per cent interest This pawnshop o Lombard . . r ,

as it is called aff ords a revenue it is pretended to the stat e

, , ,

of a hundred and fifty thousand crowns which at four and , ,

S ixpence the crown amounts to sterling , .

The government f Pen sylvania without amassing any o n ,

treasure invented a method of lend ing not money indeed but

, , ,

1
S eeM mm e t l D i t t I mp m
r es co n cer na nE p t m i es ro s e os ons ‘ en ur o e, o e .

P 73
30 2 Th e W eal t h of N at i o n s
what is equivalent to money t o its subjects By advancing to , .

private people at interest and upon land security to double the

,

value paper bills f credit to be redeemed fifteen years after

,
o

their date and in the meantime made transferable from hand

,

t o hand like bank notes and declared by act o f assembly to be

,

a legal tender in all payments from o e inhabitant of the pro n

vince to another it raised a moderate revenue which went a

, ,

considerable w y towards defraying an annual expense o f about

a

£ 5
4 00 ,
the whole ordinary expense o f that frugal and orderly
government The success of an expedient o f this kind must
.

have depended upon three different circumstances ; first upon ,

the de mand for some other instrument Of commerce besides

gold and silver money ; or upon the demand fo r such a quantity
o f consumable sto c k as could not be had without sending

a broad the greater part o f their gold and silver money in order
to purchase it ; secondly upon the good credit of the govern
,

ment which made use of this expedient ; and thirdly upon the , ,

moderation with which it w s used the whole value f the a ,

o

paper bills of credit never exceeding that of the gold and silver
money whic h would have been necessary for carrying o their n

circulation had there been no paper bills of credit The same .

e xpedient was upon di fferent occasions adopted by several other

American colonies but from want f this moderation it p ro

: ,
o ,

d u c ed in the greater part of them much more disorder than

, ,

c onveniency .

The unstable and perishable nature o f stock and credit how ,

e ver render them unfit to be trusted to as the principal funds

,

o f that sure steady and permanent revenue which can alone

, ,

g ive security and dignity to government The government o f .

no great nation that was advanced beyond the shepherd state

seems ever to have derived the greater part of its public revenue
from such sources .

Land is a fund f a more stable and permanent nature ; and

o

the rent o f public lands accordingly has been the principal

, ,

sour e o f the public revenue of many a great nation that w a

c s

much advanced beyond the shepherd state From the produce .

o r rent of the public lands the ancient republics o f Greece and

,

Italy derived fo a long time the greater part o f that revenue

,
r ,

which defrayed the necessary expenses Of the commonwealth .

The rent of the crown lands constituted for a long time the
greater part of the revenue Of the ancient sovereigns of Europe .

War and the preparation for w are the two circumstances ar

w hich in modern times occasion the greater part Of t hegec es n

 Th e S o u r c e s of R ev e n u e 0
3 3
s ary expense of all great states But in the ancient republics .

o f Greece and Italy every citizen w a a soldier w h both served s ,

o

and prepared himself fo service at his o w expense N either

r n .

o f those two circumstances therefore could occasion any very, ,

considerable expens e to the state The rent of a very moderate .

landed estate might be fully uflfc ie t fo r defraying all the other

s n

n ecessary expenses o f government .

In the ancient monarchies of Europe the manners and ,

customs of the times sufficiently prepared the great body o f the

people for war ; and when they took the field they were by , ,

the condition of their feudal tenures to be maintained either ,

at their o w expense o r at that o f their immediate lords with

n , ,

o u t bringing y new charge upon

an the sovereign The other .

expe ses o f government were the greater part o f them very

n , ,

moderate The administration of justice it has been shown

.
, ,

instead of being a cause o f expense w a source o f revenue ,

as .

The labour o f the country people for three days before and for ,

three days after harvest was thought a fund u flic ie t fo,

s n r

making and maintaining all the bridges highways and other , ,

public works which the commerce o f the country w supposed as

to require In those days the principal expense o f the sove

.

reign seems to have consisted in the maintenance f his o w o n

family and househo l d The o flic er f his household accord

. s o ,

igly were then the great Officers of state

n ,
The lord treasurer .

re eived his rents The lord steward and lord Chamberlain

c .

looked after the expense o f his family The care f his stables . o

w a s committed to the lord constable and the lord marshal .

His houses were all built in the form Of castles and seem to ,

have been the principal fortresses which he possessed The .

keepers o f those houses o r castles might be considered as a sort

o f milita ry governors They seem to have been the only mili
.

tary o fficers whom it w s necessary to maintain in time o f

a

peace In these ci rcumstances the rent of a great landed estate

.

might upon ordina y occasions very well defray all the necessary
,
r ,

expenses f gove rnment

o .

In the present state o f the greater part of the civilised

monarchies f Europe the rent of all the lands in the country
o , ,

managed as they probably would be if they all belonged to o e n

proprietor would scarce perhaps amount t the ordinary revenue

, o

which they levy upon the peop le even in peaceable times The .

ordinary revenue f Great Britain for example includ ing o t

o , ,
n

only what is necessary for defraying the current expense o f the

year but for paying the interest f the public debts and for
, o ,
 0
3 4 Th e W eal t h of N at i o n s
sinking a part of t hezcap it al of those debts amounts t o upward , s

of ten millions a year But the land tax at four shillings in.
,

the pound falls short o f two millions a year This land tax as
, .
-

it is called however is supposed to be o e fifth not o nly f

, , n ,
o

the rent of all the land but o f that o f all the houses and o f , ,

the interest o f all the capital stock of Great Britain that part ,

of it only excepted which is either lent to the public o r em ,

ployed as farming stock in the cultivation of land A very .

considerable part o f the produce o f this tax arises from t he

rent of houses and the interest o f capital stock The land tax
, .
-

of the city o f London for example at four shillings in the , ,

pound amounts to
,
65 7d That o f the city o f West . .

m inster to ,
S 5d That o f the palaces of Whitehal l
I . .

and St James s to
.
’
65 3d
,
A certain proportion o f t h e . .

land tax is in the same manner assessed upon all the other
-

cities and towns corporate in the kingdom and arises almost ,

altogether either from the rent o f houses o from what is

, ,
r

supposed to be the interest f trading and capital stock A c o .

cording to the estimation therefore by which Great Britain is , ,

rated to the land tax the whole mass o f revenue arising from
-

the rent of all the lands from that Of all the houses and from , ,

the interest o f all the capital stock that part o f it only excepted ,

which is either lent to the public r employed in the cultiva ,

o

t i on of land does t exceed ten millions sterling a year the

,
no ,

ordinary revenue which government levies upon the people even

in peaceable times The estimation by which Great Britain is
.

rated to the land tax is no doubt taking the whole kingdom

-

, ,

at an average very much below the real value ; though in

,

several particular counties and districts it is said to be nearly

equal to that value The rent o f the lands alone exclusive o f
.
,

that of houses and of the interest f stock has by many people

,
o ,

been est imated at twenty millions an estimation made in a ,

great measure at random and which I apprehend is as likely , , ,

to be above as below the truth But if the lands o f Great .

Britain in the present state Of their cultivation do o t afford a

, ,
n

rent of more than twenty millions a year they could no t well ,

a fford the half most probably not the fourth part o f that rent
, ,

if they all belonged t a single proprietor and were put under

o ,

the negligent expensive and Oppressive management o f his

, ,

factors and agents The crown lands of Great Britain do not

.

at present afford the fourth part o f the rent which could prob
ably be drawn from them if they were the p r p e t yZOf private O r
 The S o u r c e s o f R ev e n u e 0
3 5
p ersons If the.crown lands were more extensive it i s probable ,

t hey would be st i ll worse managed .

The revenue which the great body f the people derives from o

land is in proportion o t to the rent but to the produ e f the

,
n ,
c o

land The whole annual produce o f t heila d f every country

.
‘

n o ,

i f w e except what is reserved f seed is either annually c o or ,

n

sumed by the great body o f the people or exchanged for some ,

t hing else that is consumed by them Whatever keeps down .

t he produce o f the land below what it would otherwise rise to

k eeps down the revenue f the great body o f the people still o

more than it does that f the proprietors o f land The rent o f

o .

land that portion o f the produce which belongs to the p o

,
r

pr i
e t o is scarce
rs , anywhere in Great Britain supposed to be
more than a third part o f the whole produ e If the land c .

w hi ch in o e state of c ultivation aff ords a rent f ten millions

n o

s terl ing a year would in another afio d a rent o f twenty millions r ,

the rent being in both cases supposed a third part o f the

, ,

produ e the revenue of the proprietors would be less than it

c ,

otherwise might be by ten mil lions a year only ; but the revenue
o f the great body o f the people would be less than it otherwise

might be by thirt y millions a year deducting only what would ,

be necessary fo seed The population f the ountry would

r . o c

be less by the number o f people which thirty m illions a year ,

deducting always the seed could maintain a c c ordin g to the ,

particular mode of living and expense whi h might take place c

in the different ranks f me among whom the remainder was o n

d istributed .

Though there is not at present in Europe any ivilised state , ,

c

o f any kind whi h derives the g reater part f its publi revenue
c o c

from the rent f lands whi h are the property o f the state yet
o c ,

in all the great monarchies f Europe there are still many large o

tra ts o f land which belong to the rown They are generally

c c .

forest ; and sometimes forest where after travelling several ,

miles you will scarce find a single tree ; a mere waste and lo ss
,

o f ountry in respect both of produ e and population

c In every c .

great monarchy o f Europe the sale f the rown lands would o c

produce a very large sum o f money which if applied to the , ,

payment o f the publi debts would deliver from m ortgage a

c ,

much greater revenue than any which those lands have ever
afforded to the crow In countries where lands improved and
n .
,

c ultivated very highly and yielding at the time of sale as great

,

a rent as can eas i ly be go t from them commonly sell at thirty ,

years purchase the unimproved uncultivated and lo w rented

’
-

, , ,
306 The W eal t h of N a t i o n s
crown lands might well be expected to sell at forty fifty o r , ,

sixty years purchase The rown might immediately enjoy t he

’
. c

revenue which this great pri e would redeem from mortgage c .

In the course o f a few years it would probably enjoy anothe r

revenue When the rown lands had become private property
. c
,

they would in the ourse o f a few years be ome well improve d

,
c ,
c

and well cultivated The increase o f their produce would

.

increase the population o f the country by augmentin g t he

revenue and onsumption of the people But the revenue whi h
c . c

the crown derives from the duties of customs and excise would
necessarily increase with the revenue and consumption o f t he
people .

The revenue whi h in any civilised monarchy the crown

c , ,

derives from the crown lands though it appears to cost nothing ,

t o individuals in reality costs more to the so iety than perhap s

,
c

any other equal revenue whic h the crow enj oys It would in n .
,

all cases be for the interest o f the society to replace this revenu e
,

to the crown by some other equal revenue and to divide the ,

lands among the people which could not well be done better
, ,

perhaps than by exposing them to public sale

Lands for the purposes of pleasure and m g ific c e—parks
.
,

a n en ,

gardens public walks etc possessions whi h are everywhere c

—
.
, , ,

considered as causes of expense not as sources o f revenue see m ,

to be the only lands which in a great and civilised monarchy , ,

ought to belong to the crown .

Public sto c k and public lands therefore the two sources o f , ,

revenue which may peculiarly belong to the sovereign o r

commonwealth being both improper and insufficient funds fo
,
r

defraying the necessary expense o f any great and civilised state ,

it remains that this expense must the greater part o f it b e , ,

defrayed by taxes o f o e kind o r another ; the people contri

n

buting a part o f their o w private revenue in order to make up

n

a public revenue to the sovereign o r commonwealth .

P A RT I I

Of Ta xes
The private revenue f individuals it has been shown in the
o ,

first book o f this Inquiry arises ultimately from three different

,

sources ; Rent Profit and Wages Every tax must finally be

, ,
.

paid from so me o other of those three different sor t s o f

ne o r

revenue o r from all o f them indifferently I shall endeavour t o

,
.
 Th e S o u r c e s of R ev en u e 0
3 7
give the best ac ount I ca n first o f those taxes t ich it is
c , ,
‘

intended should fall upon rent ; secondly o f those which it

, , ,

is intended should fall upon profit ; thirdly of t hose which it is

, , ,

intended should fall upon wages ; and fourthly Of those which

, , , ,

it is intended should fall indifferently upon all those three

,

different sources o f private revenue The parti c ular considera .

tion f each o f these four different sorts o f taxes will divide the
o

se c ond part f the present chapter into four articles three o f

o ,

whic h will require several other subdivision Many f those s . O

ta xes it will appear from the followin g review are not finally
, ,

paid from the fund o r source f revenue upon which it w as

,
o ,

intended they should fall .

Before I enter upon the exam ination o f particular taxes it ,

is necessary t o prem ise the four following maxims with regard

to ta xes in general .

I The subjects o f every state ought to contri bute towards

.

the support o f the government as nearly as possible in pro , ,

portion to their respective abilities ; that s in proportion to the 1 ,

revenue which they respectively enj oy under the protection o f

the stat e The expense f government to the individuals o f a
. o

great nation is like the expense f m anagement to the jo int o

tenants f a great estate w ho are all obliged to contribute in

o ,

proportion to their respective interests in the estate In t h . e

observation o neglect f this maxim consists what is alled

r o c

the equality o inequali t y of taxation Every tax it must be

r .
,

Observed once f all whih falls finally upon o o nly of t he

or ,
c ne

three sorts o f revenue above mentioned is necessarily unequal ,

in so far as it does not affe t the other two In the followin g c .

examination o f diff erent taxes I shall seldom ta ke much furthe r

noti e of this sort f inequality but shall in m ost cases confine

c o , , ,

my observations to that inequality whi h is oc asioned by a c c

particular tax falling unequally even upon that parti ular sort c

o f private revenue w hi ch is affe ted by it c .

II The tax which each individual is bound to pay ought t o

.

be certain and not arbitrary Th time o f paym ent the man e

, . e ,
n r

o f paym ent the quantity t,

be paid ought all to be lear and o ,
c

p lain to the ontributor andc to every other person Where

,
it .

is otherwise every person subje t to the tax i put more o

,
les s c s r

in the power o f the tax gatherer who can either aggravate the
-

tax upon any obnoxious contributor o extort by the terror f ,

r ,
o

such aggravation some present o perquisite to himself The

,
r .

uncerta inty f taxation en ourages the insolen e and favours

o c c

the corruption o f an order Of men who are naturally unpopular ,

308 Th e W e al t h of N at i o n s
e ven where they are neither insolent nor corrupt The cer .

ta inty f what each individual ought to pay is in taxation a

o , ,

matter o f so great importance that a very onsiderable degree c

o f inequality it appears I believe from the experien e o f all

, , ,
c

nations is o t near so great an evil as a very small degree f

,
n o

un c erta inty .

III Every tax ought to be levied at the time or in the

.
,

manner in which it is most likely to be convenient for the

,

contributor to pay it A tax upon the rent of land o of houses . r ,

p ayable at the same term at which such rents are usually paid ,

is levied at the time when it is most likely to be convenient

fo the contributor to pay ; o

r when he 5 most likely to have r, 1

wherewithal to pay Taxes upon such onsumable goods as are . c

a rticles o f luxury are all finally paid by the c onsumer and ,

generally in a manner that is very convenient for him He .

pays them by little and little as he has o c casion to buy the ,

goods As he is at libert y t o o either to buy or not to buy

.
, , , ,

as he pleases it must be his own fault if he ever su ffers any

,

c onsiderable i o i c y f o m su h taxes nc nv en en o r c .

IV Every tax ought to be so contrived as both to take o ut

.

a d to keep out of the pockets of the people as little ib l

'

n o e as ss
p
over and above what it brings into the public treasury of the
s tate A tax may either take o ut o keep o ut of the pockets
. r

o f the people a great deal more than it rings into the public
b
treasury the four following ways First the levying f it
,
111 .
,
o

may require a great number Of officers whose salaries may eat ,

up the greater part of the produce o f the tax and whose per ,

q u i it
s may impose
es another additional tax upon the people .

Se c ondly it may obstruct the industry o f the people and dis

, ,

c ourage them from applying to ertain branches of business c

whi h might give maintenance and employment to great multi

c

tudes While it obliges the people to pay it may thus diminish

.
, ,

o rperhaps destroy some o f the funds which might enable them

,

more eas ily to do so Thirdly by the forfeitures and other .

,

penalties which those unfortunate individuals incur who attempt

unsuccessfully to evade the tax it may frequently ruin them , ,

an d thereby put an end to the benefit whi h the community c

m ight have received from the employment o f their capitals .

An injudicious tax o ffers a great temptation to smuggling But .

the penalties o f smuggling must rise in proportion to the temp

t at io The law contrary to all the ordinary principles o f
n .
,

j ustice first creates the temptation and then punishes those

, ,

w h yield to i t ; and it commonly enhances the punishment too

o , ,
 Th e S o u r c es of R ev en u e 0
3 9
in propo rtion to the very c ircu mstance which ought certa in ly
to alleviate it the temptation to commit the crime Fo urt hly
,
.
1
,

by subje ting the pe ople to t he frequent visits and the odious

c

examination of the tax gatherers it may expose them to much -

unnecessary trouble vexation and Oppression ; and though

, ,

vexation is not strictly speaking expense it is certainly equ ia

, , ,
v

lent to the expense at which every man would be willing to

redeem himself from it It is in some e o other o f these four
. on r

d ifferent ways that taxes are frequently so much more burden

some to the people than they are beneficial to the sovereign .

The evident justice and utility o f the forego in g maxims have

recommended them more o r less to the attention f all nation o s .

All nations have end eavoured to the be st o f their judgment to , ,

render their taxes as equal as they could cont rive ; as certa in ,

as conve nient to the cont ributor bo th in the time and in t he ,

mode o f payment and in proportion to the revenue which they

, ,

brought t o the prince as little burdensome to the people The

,
.

f ollowing short review o f some o f the principal ta xes which ha e v

taken place in d ifferent ages and countries will show that t he

endeavours f all natio n s have o t in thi
o s respect been equally n

succ essful .

ARTI C L I E

Taxes u p on Ren t . Taxes u p on the Ren t o f L an d

A tax upon the rent f land m y either be imposed ac ording
o a c

to a certain canon eve ry distri c t being valued at a certa in rent

, ,

which valuation is not afterwards to be altered it may be ,

or

imposed in such a manner as to va y with every variation in r

the real rent f the land and to rise o fall with the irn p e
o ,
r ro v

ment o declension o f its cultivation

r .

A lan d tax which like that f Great Brita in is assessed upon

-

,
o ,

each district a c ord ing to a ertai invariable canon though it

c c n ,

should be equal at the time of its first establishment necessarily ,

becomes unequal in process o f time according to the u equal ,

n

degrees of improvement o negle t in the cultivation o f t he r c

d iff erent parts f the co untry In England the valuation

o .
,

according to whi h the different counties and parishes were

c

assessed to the land tax by the 4 t h o f William and Mary w

-
as

very unequal even at its first establishment This tax there .

,

fore so far offends against the first of the four maxims abo ve
,

mentioned It is perfectly agr eeable to the other three It is

. .

S Sk t h
1
f t h H it y f M
ee p g 4 74 t q
e c es o e s or o an, a e ,
e se .
3 10 W T he
e al t h of N a t i o n s

perfectly certain The t ime f payment for the tax being the
. o ,

same as that for the rent is as convenient as it can be to the

,

c ontributor Though the landlord is in all cases the real con

.

tributor the tax is commo n ly advanced by the tenant to whom

, ,

the landlord i s obliged to allow it in the payment o f the rent .

This tax is levied by a much smaller number o f o fficers than

any other which affords nearly the same revenue As the tax .

upon each district does t rise with the rise o f the rent the
no ,

sovereign does not share in the profits Of the landlord s improve ’

ments Those improvements sometimes contribute indeed to

.
, ,

the discharge o f the other landlords of the district But the .

a g ravation o f the tax which this may sometimes occasion upon

g
a particular estate is always so very small that it never can
discourage those improvements nor keep down the produce o f ,

the land below what it would othe r wise rise to A s it has no .

tendency to diminish the quantity it can have none to raise ,

the price o f that produce It does not obstruct the industry

.

o f the people It subjects the landlord to no other in c o n

.

ve i
n e c y besides the unavoidable one o f paying the tax
n .

The advantage however which the landlord has derived from

, ,

the invariable constancy f the valuation by which all the o

lands of Great Britain are rated to the land tax has been -

p rin cipally owin g to some circumstances altogether extraneous

t o the nature Of the tax .

It has been owing in part to the great prosperity o f alm o st

e ve y part o f the count ry the rents o f almost all the estates of
r ,

Great Britain having s ince the time when this valuation w s

,
a

first established been continually rising and scarce any f them

, ,
o

h aving fallen The landlords therefore have almo st all gained

.
, ,

the diff erence between the tax which they would have paid
according to the present rent o f their estates and that which ,

they actually pay accordin g to the ancient valuation Had the .

state o f the count ry been different had rents been gradually ,

falling in consequence of the declension o f cultivation the land ,

lords would almost all have lost this difference In the state o f .

things which has happened to take place since the revolution ,

the constancy o f the valuation has been advantageous to the

landlord and hurtful to the sovereign In a different state o f .

things it might have been advantageous to the sovereign and

hurtful to the landlord
As the tax is made pay
.

able money so the valuation o f the 111 ,

land is expressed in money Since the establ i

shment Of this .

v aluation the value of silver has been pretty uniform and there ,
 T he So u r c e s of R e v en u e 3 1 I

h as been no alteration in the standard o f the coin either as t o

weight o fineness Had silver risen considerably in its value
r .
,

a s it seems to have done in the course o f the two centuries

w hich preceded the discovery o f the mines o f America the con ,

s t a c y o f the valuation might have proved ve ry Oppressive to

n -

the landlord Had silver fallen considerably in its value as it

c ert a m
.
,

ly did for about a centu ry at least after the discovery Of

those mines the same constancy o f valuation would have reduced
,

very much this branch o f the revenue o f the sovereign Had .

any considerable alteration been made in the standard o f t he

money either by sinkin gthe same quantity Of silver to a lower
,

denomination o by ra sing it to a higher ; had an ounce f

,
r i o

silver fo r example instead of being coined into five shillings

, ,

and twopence been coined either into pieces which bore so lo w

,

a denomination as two shillings and sevenpence o into pieces ,

r

which bore so high a o e as ten shillings and fourpence it would n ,

in the one case have hurt the revenue o f the proprietor in t he ,

other that of the sovereign .

In circumstances therefore somewhat d ifl e e t from those

, ,
r n

which have actually taken place this constancy f valuation ,

o

might have been a very great inconveniency either t o the con ,

t i rb ut or to the commonwealth In the course of ages such

o rs, .

circumstances however must at some time other happen

, , ,
or ,
.

But though empires like all the other works f men have all ,
o ,

hitherto proved mortal yet every empire aims at immortality , .

Every constitution therefore which it is meant should be as

, ,

permanent as the empire itself ought to be convenient not in , ,

certain circumstances only but in all circu mstances ; o ought ,

r

to be suited not to those ir umstances which are transitory

,
c c ,

occasional o accidental but to those which are necessary and

,
r ,

therefore always the same .

A tax upon the rent o f land which varies with every variat ion
o f the rent o which rises and falls according to the improve
,
r

ment or neglect o f cultivation is recommended by that sect o f ,

men of letters France who call themselves the economists as

111

the most equitable f all taxes All taxes they pretend fall o .
, ,

ultimately upon the rent o f land and ought therefore to b e ,

imposed equally upon the fund which must finally pay them .

That all taxes ought to fall as equally as possible upon the fund
which must finally pay them is ert ainly true But without c .

entering into the disagreeable discussion f the metaphysical o

argu ments by which they support their very in genious theory ,

it will sufficiently appear from the following review what are , ,
 312 T he W eal t h of N at i o n s
the taxes which fal l finally upon the rent of the land and what ,

are those which fall finally upon some other fund .

In the Venetian territo ry all the arable lands which are give n

in lease to farmers are taxed at a tenth f the rent The o .

1

leases are recorded in a public register which is kept by t he

o fli rs
ce o f revenue in each province o r district Wh en the pro .

pr iert o cultivates his o wn lands they are valued according t o ,

an equitable estimation and he is allowed a deduction o f one

,

fifth of the tax so that for such lands he pays only eight
,

instead of ten per cent o f the supposed rent

. .

A land tax of this kind l s certainly more equal than the land
t a x o f England It might not perhaps be altogether o certain
.
, ,
s ,

a n d the assessment o f the tax might frequently occasion a good

deal more trouble to the landlord It might too be a good deal .

, ,

more expensive in the levying .

Such a system of administration however might perhap , ,

s

be contrived as would in a gr eat measure both prevent this

, ,

uncertainty and moderate this expense .

The landlord and tenant for example m ight jointly b e , ,

obliged to record their lease in a public register P roper penal .

ties might be enacted against concealing o r misrepresenting any

of the conditions ; and if part o f those penalties were t o be paid
to either of the t w o parties who informed against and convicted
the other Of such concealment o r misrepresentation it would ,

effectually deter them from combin ing together in order t o

defraud the public revenue All the conditions Of the lease
.

might be sufficiently known from such a record .

Some landlords instead of raising the rent take a fine for the
, ,

renewal of the lease This practi c e is in most c ases the expedient

.

o f a spendthrift who for a sum o f ready money sells a future

,

revenue o f mu h greater value It is in most cases therefore

c .
, ,

hurtful to the landlord It is frequently hurtful to the tenant

.
,

and it is always hurtful to the community It frequently takes .

from the tenant so great a part o f his capital and thereby ,

diminishes so mu h his ability to cultivate the land that he finds

c ,

it more difficult to pay a small rent than it would otherwise

have been to pay a great o e Whatever diminishes his ability
n .

to cultivate necessarily keeps down below what it would other

, ,

wise have been the most impor t a nt part o f the revenue of the
,

co mmunity By rendering the tax upon su c h fines a good deal

.

heavier than upon the ordinary rent this hurtful practic e might ,

be discouraged to the no small advantage of all the different

,

1
M mi
e t l D i t pp 4 0 4
o res co n cern a n es ro s, . 2 , 2 1.
 Th e S o u r c es of R ev en ue 31
3
parties concerned o f the landlord of the tenant of the sovereign
, , , ,

and of the whole community .

Some leases prescribe to the tenan t a certain mode of cultiva

tion and a certain succession f rops during the whole con o c

ti nu ance f the le as e
o This condition which is generally the
.
,

eff ect o f the l a ndlord s conceit Of hi w supe rior knowledge

’
s o n

( a conceit in most ca s es very i

ll founded ) ought always to be ,

considered as an additional rent ; as a rent in serv i e instead c

o f a rent in money In order to discourage the pra ti e which

. c c ,

is generally a foolish one this species of rent might be valued ,

rather high and consequently taxed somewhat higher than

,

common money rents .

Some landlords ins tead of a rent in money require a rent in

, ,

kind in corn cattle poul t ry wine o il etc ;others again require

, , , , , ,
.
, ,

a rent in service Such rents are always more hurtful to the

.

t enant than beneficial to the landlord They either take more .

o r keep more out f the pocket o f the former than they put into
o

that Of the latter In every count ry where they take place

.

the tenants are poor and beggar ly prett y much a cording to ,

c

the degree in whih they take pla e By valuing in the same

c c .
,

manner such rents rather high and con equently taxing them
, ,
s

somewhat higher than ommon money rents a practi e which c ,

c

is hurtful to the whole community might perhaps be sufficiently

discouraged .

When the landlord hose to o upy himself a part f his o wn

c cc o

lands the rent might be valued a ording to

,
equitable cc an

arbitration f the farmers an d landlords in the neighbourhood

o ,

and a moderate abatement f the tax might be gr nted t o him o a

,

i n t he same manner as in the Venetian territory provided the ,

rent of the lands which b e o cupied did t exceed a certa in sum c no .

It is o f importan e that the l ndlord should be encouraged to

c a

cultivate a part f his w land His capital is generally greater

o o n .

than that f the ten nt and with less skill he a frequently

o a ,
c n

raise a greater produce The landlord can aff ord t o t y ex . r

p e i
r rn t s and
en generally
,
disposed
is to do so His unsuccessfu l .

experiments oc ion o n ly a moderate loss to himself His

cas .

successful ones ontribute to the improvement and better

c

c ultivation o f the whole cou try It might be o f importance n .

,

however that the abatement o f the tax should encourage him

,

t o cultivate to a certain extent only If the landlords should .

,

the greater part f them be tempted to farm the whole of their

o ,

ow n lan ds the country (instead o f sober and industriou tenants

,
s ,

who are bound by their o wn interest t o cultivate as we ll as

11 L
 1
3 4 T he W eal t h of N at i o n s
their capital and skill will allow them ) would be filled with idl e '

and p o fl igat e bailiffs whose abusive management would soon

r ,

degrade the cultivation and reduce the annual produce o f t he

land to the diminution not only o f the revenue of their masters
, , ,

but o f the most important part of that o f the whole society .

Su c h a system o f administration might perhaps free a tax , ,

o f this kind from any degree o f uncertainty whi c h could o ca c

sion either oppression or in onveniency to the contributor ; and c

might at the same time se ve to introdu c e into the common r

man agement o f land su h a plan o r policy as might contribute c

a good deal to the general improvement and good cultivation

o f the country .

The expense o f levying a land tax which varied with every -

variation Of the rent would no doubt be somewhat greater than

that o f levyin g o n e whi c h was always rated according to a fixed
valuation Some additi . onal expense would necessarily be ih
curred both by the different register offices which it would b e
proper to establish in the different districts o f the country and ,

by the different valuations which might occas ionally be mad e

of the lands which the proprietor chose to o c upy himself The c .

expense f all this however might be very moderate and much

o , , ,

below what is incurred in the levyi ng o f many other taxes

whi h afford a very inconsiderable revenue in omparison o f
c c

what might easily be drawn from a tax o f this kind .

The dis ouragement which a variable land tax of this kind

c -

might give to the improvement of land seems to be the most

important objection whi h can be made to it The landlord c .

would certainly be less disposed to improve when the sovereign ,

w ho contributed nothing to the expense was to share i n the ,

profit f the un p o v m t Even this obje tion might perhaps

o r e en . c

be obviated by allowing the landlord before he began his im ,

prov ement to ascertain in onjun tion with the Oflic s of

, ,
c c er

revenue the actual value o f his lands according to the equitabl e

,

arbitration o f a certain number of landlords and farmers in the

neighbourhood equally hosen by both parties and by rating
,
c ,

him a cording to this valuation fo su h a number of years as

c r c

might be fully su ffi ient fo his complete indemnification To

c r .

draw the attention of the sovereign towards the improvement of

the land from a regard to the increase of his o w revenue is
,
n ,

o e o f the principal advantages proposed by this species

n f land o

tax The term therefore allowed for the indemnification of the

.
, ,

l andlord ought not to be a great deal longer than what was

necessary fo r that purpose lest the remoteness o f the interest ,
 Th e S o u r c e s of R e v en u e 3 5 1

should discourage t o much this attention It ha d better how

o .
,

ever be somewha t too long than in any respect too short No

,
.

incitement to the attention o f the sovereign can ever counter

balance the smallest discouragement to that o f the landlord .

The attention of the sovereign can be at best but a very genera l

and vague onsideration o f what is likely to contribute to t he
c

better cultivation o f the greater part o f his domin ions The .

attention o f the landlord is a particular and minute considera

tion of what is likely to be the most advantageous applicatio n
of eve ry inch of ground upon his estate The principal attention .

o f the sovereign ought to be to encourage by every means in ,

hi s power the attention both o f the landlord and of the fa mer

,
r ,

by allowing both to pursue their o w in terest in their o w n w y n a

and according to their o w judgment ; by giving to both t he

n

most perfe t security that they shall enjoy the full recompense
c

of their o w industry ; and by pro uring to both the mos t

n c

extensive market for every part of their produce in consequenc , e

o f establishing the easiest and safest communications both b y

l and and by water through every part of his o w domin ions a s n

well as the most unbounded freedom of exportation to t he

dom inions f all other prin ces
o .

If by such a system of administration a tax o f this kind could

be so managed as to give not only o discouragement but o
,
n , ,
n

the contrary some encouragement to the improvement o f land

, ,

it does not appear likely to occasion any other in onvenien y c c

to the landlord except always the unavoidable o n Of being

, e ,

obliged to pay the tax .

In all the variations of the state of the society in the im ,

provement and in the declension of agri ulture in all the c ,

var at ons the value of silver and all those the sta ndard
.

i i in ,
111 111

of the coi a tax of this kind would of its o w a cord d

n, , n c an

Without any attention o f government readily suit itself to the ,

a tual situation f things and would be equally just and qu it

c o , e

able in all those different changes It would therefore b e .

, ,

mu h more proper to be established as a perpetual and u

c n
alterable regulation as what alled a fundamental law o f
,
or IS c

the commonwealth than any tax whi h was always to be levied

,
c

ca cording to a ertain valuation

c .

Some states instead o f the simple and Obvious expedient o f

,

a register f leases have had recourse to the laborious d

o , an

expensive o f an actual survey and valuation o f all the land s

ne o

in the country They have suspe ted probably that the lessor
. c , ,

and lessee in order to defraud the pub lic revenue might comb ine
, ,
:
 3 16 The W eal t h of N at i o n s
to conceal the real te rms of the lease Doomsday book seems .
-

to have been the result of a very ac urate survey o f this kind c .

In the ancient dominions of the King o f Prussia the land tax ,

-

is assessed according to an actual survey and valuation which ,

i reviewed and altered from time to time

s According to that .
1

valuation the lay proprietors p y from twenty to twenty fiv e

,
a -

p er cent o f their revenue. Ecclesiastics from forty to forty fiv e .

-

per cent The survey and valuation f Silesia w a made by order

. o s

O f the present king ; it is said with great accuracy According .

to that valuation the lands belonging to the Bishop f B e law ,

o r s

are taxed at twenty fi e per cent f their rent The other -

v . o .

revenues of the ecclesiasti s Of both religions at fifty per cent c ,

.

The ommanderies o f the Teutonic order and of that o f Malta

c
—
, ,

at forty per cent L ands held by a noble tenure at.thirty eight ,

and one third per cent Lands held by a base tenure at thirty
-
.
,

fi e and o e third per cent

v n -

The survey and valuation o f Bohemia is said to have been the

w ork o f more than a hundred years It was not perfected till .

a fter the peace o f 74 8 by the orders f the present empress 1 ,

o

queen The survey of the duchy f Milan which w begun

.
2 o ,
as

in the time f Charles VI wa not perfected till after 760

o .
,
s 1 .

It is esteemed f the most accurate that has ever been made

one o .

The survey o f Savoy and Piedmont was executed under the orders
o f the late Kin g o f Sardinia
3
.

In the dominions of the King f P russia the revenue of the o

church is taxed much higher than that o f lay proprietors The .

r evenue of the church is the greater part o f it a burden upon , ,

t h e rent o f land It seldom happens that any part o f it is

.

applied towards the improvement o f land o is so employed as ,

r

to contribute in any respect towards increasing the revenue f o

t he great body o f the people His Prussian Maj esty had probably .
,

u pon that account th ought it reasonable that it should c ,

on

tribute a good deal more towards relieving the exigencies of

the state In some countries the lands of the church are
.

exempted from all taxes In others they are taxed more .

lightly than other lands In the duchy o f Milan the lands .

,

which the church possessed before 5 75 are rated to the tax at 1

a third only Of their value .

In Silesia lands held by a noble tenure are taxed three per

,

c ent higher than those held by a base tenure

.
The honours .

1
Mmi e t l D it t t m 1 pp
o r es c o n cerna n 4 5 6 t es ro s, e c o e 11 11 11 e c.

d pp 8 3 8 4
. . . .
, , ,
1
I bi
I b d p l p 87 t t
.
. .
,

i 80 t
. . 2 ,
e c .
,
a so . 2 , e c .
, o
 The S o u r c e s of R ev e n u e 31
7
and privileges f different kinds annexed to the former hi
o ,
s

Prussian Majesty had probably imagined would su fficiently ,

co mpensate to the proprietor a small aggravation of the tax ;

while at the same time the humiliating inferiority o f the latte r

would be in some measure alleviated by being taxed some

'

what more lightly In other countries the system o f taxa

.
,

tion instead of alleviating aggravates this inequality In the

, ,
.

do m inions of the King of Sardinia and in those provinces o f ,

France which are subj ect to what is called the real predial or

taille the tax falls altogether upon the lands held by a bas e
,

tenure Those held by a noble o e are exempted

. n .

A land tax assessed according to a general su rvey and val a

-
n

t ion h w equal soever it may be at first must in the course f

,
o , ,
o

a very moderate period of time become unequal To prevent ,

.

its becom ing so would require the continual and painful attention
o f government to all the variations in the state and produce

o f every different farm in the country The governments o f .

Prussia o f Bohemia of Sardi n ia and f the duchy o f Milan

, , ,
o

actually exert an attention of this kind ; an attention so um

suitable to the nature f government that it is o t likely to b e o n

o f long continuance and which if it is contin u ed will probably

, , ,

in the long run occasion much more trouble and vexation than
-

it can possibly bring relief to the contributors .

In 666 the generality o f Mo t u b a w s assessed to t he

1 ,
n a n
'

real o predial taille according it is said to a very exact survey

r , ,

and valuation By 7 7 this assessment had be ome altogethe

.
1
1 2 ,
c r

unequal In order to remedy this in c onveniency government

.
,

has found no better expedient than to impose upon the whol e

generality an additional tax of a hundred and twenty thousan d

livres This additional tax is rated upon all the different district s
.

subject t the taille according to the ld assessment But it is

o o .

levied only upon those whi h in the actual state o f thin gs are c

by that assessment u dertaxed and it is applied to the relie f n ,

of those which by the same assessment are overtaxed Tw . o

districts for example one of whi c h ought in the actual state f

, ,
o

things to be taxed at nine hundred the other at eleven hundred ,

liv res are by the o ld assessment both taxed at a thousand livres

,
.

Both these districts are by the additional tax rated at eleven

hundred livres e ach But this additional tax is levied only
.

upon the district undercharged and it is applied altogether t o ,

the relief of that overcharged which consequently pays only ,

nine hundred livr es The government neither gains nor lose s

.

M mi 1
t l
e D t t t m p 39 t
o r es c o n c erna n es ro is , e c .
, o e 11 . . 1 ,
e c .
3 8 1 The W e al t h o f N at i o n s
by the additional tax which is applied altogether to remedy ,

the inequalities arising from the old assessment The applica .

tion is pretty much regulated according to the discretion of the

intendant o f the generality and must therefore be in a great , , ,

m easure arbitrary

Ta xes whi
ch a re p p ro o rti
o n ed , n ot t o the Ren t, bu t to the
P r o du ce o f L an d

Taxes upon the produce o f land are in reality taxes upon the
rent ; and though they may be originally advanced by the
farmer are finally paid by the landlord When a certain portion
, .

Of the produce is to be paid away for a tax the farmer computes , ,

as well as he can what the value of this portion is o e year with

, ,
n

another likely to amount to and he makes a proportionable

, ,

a batement in the rent which he agrees to pay to the landlord .

There is no farmer who does not compute beforehand what the

c hurch tythe which is a land tax o f this kind is o e year with
,
-

, ,
n

a nother likely to amount to

, .

The tythe and every other land tax o f this k ind under the
,
-

a ppearance f perfect equality are very unequal taxes ; a certain

o ,

portion of the produce being in different situations equivalent , ,

to a very different portion f the rent In some very ri h lands o . c

the produce is so great that t he one half f it is fully su fficient o

to replace to the farmer his capital employed in cultivation ,

together with the ordinary profits o f farming stock in the

neighbourhood The other half or what comes to the same
.
, ,

thing the value o f the other half he could afford to pay as rent
, ,

to the landlord if there w s no tythe But if a tenth o f the

,
a .

p roduce is taken from him in the w ay of tythe he must require ,

an abatement o f the fifth part o f his rent otherwise he cannot ,

et back his capital with the ordinary profit In this case the
g .

rent o f the landlord instead of amounting to a half o fiv e ,

r

tenths o f the whole produce will amount only to four tenths o f ,

-

it In poorer lands o the contrary the produce is so metimes

.
,
n ,

s o small and the expense Of cultivation so great that it requires

, ,

f our fift hs f the whole produce to replace to the farmer his

-
o

c apital with the ordinary profit In this case though there w as .

,

no tythe the rent f the landlord could amount to no more than

,
o

o e fift h o t w o tenths of the whole produce

n -
r But if the farmer
-

pays o e tenth of the produce in the w ay o f tythe he must

n -

require an equal abatement of the rent o f the landlord whic h ,

will thus be reduced to o e tenth only o f the whole produce n -

.
 T he So u r c e s of R e v e n u e 3 19

Upon the rent f rich lands the tythe may sometimes be a t a x

o ,

o f no more than o e fi ft h part o four shill i gs in n the pound ;

-

,
r n

w hereas upon that f poorer lands it may sometimes be a t a x o ,

o f one half o r of ten shillings in the pound

-

,
.

The tythe as it is frequently a very unequal t a x upon the

,

rent so it is always a great dis c ouragement both to the im

,

p e
ro vm e t f the landlord
n s o and to the c ultivation of the farmer .

The o e cannot venture to make the most important which

n ,

are generally the most expensive in p o m t o the other r r ve en s, n r

to raise the most valuable which are generally too the most ,

e xpensive crops when the church whi h lays , ut no part f ,

c o o

the expense is to share so very largely in the profit The

,
.

c ultivation of madder was fo a long time confined by the t yt he r

to the United Provinces which bei g P resbyterian countries , ,

n ,

and upo n that account exempted from this destructive t a x ,

enjoyed a sort f monopoly o f that useful dyeing drug against

o

the rest f Europe The late attempts to in t roduce the culture

o .

o f this plant into England have been made only i consequence n

o f the statute which enacted that five shilli gs an acre should n

b e received i n lieu of all man er f tythe upon madder n o .

As through the greater part of Europe the hurch so in many c ,

d ifferent countries f Asia the state is principally supported o ,

by a land t a x proportioned not to the rent but to the produce

-

, , ,

o f the land In China the principal revenue of the sovereign

.
,

c onsists in a tenth part Of the produce f all the lands of o

the empire This tenth part however is estimated so very

.
, ,

moderately that in m any pro in es it is said not to exceed

,
v c ,

a thirtieth part f the ordina y produce The land tax or land

o r .
-

rent which used to be paid to the Mahometan government f o

B engal before that country fell into the hands f the English
, o

East India Company is said to have amounted to about a fifth ,

p art o f the produce T he land t a x o f ancient Egy pt. is said -

likewise t o have amounted to a fifth part .

In Asia this sort of land tax is said to interes t the sovereign

,
-

i the improvement and cultivation f land

n The sovereigns of o .

China those o f Bengal while under the Mahometan gover m ent

, n ,

an d those f ancient Egypt are said a ordin gly to ha e been

o ,
cc v

e xtremely attentive to the making and m ainta i ning of good

r oads and navigable c an als in order to in r ease as mu h as ,
c ,
c

p ossible b o th the
, quantity and v al ue of every part of the
produce o f the land by pro uring to every part o f it the most ,
c

e xtensive market whi h their own domi nions ould afi d The c c or .

t
t yt he o f the chur h is divided into such small portio ns that no
c
 32 0 Th e W eal t h of N at i o n s
o ne o f its proprietors can have any interest o f this kind The .

parson o f a parish could never find his ac count in maki g a road n

o
r canal to a distant part of the country in order to extend t he ,

market for the produce o f his own particular parish Such taxes .
,

when destined for the maintenance f the state have some o ,

advantages which may serve in some measure to balan e their c

in onveniency When destined for the maintenance o f the

c .

church they are attended with nothing but inconveniency

,
.

Taxes upon the produce o f land may be levied either in kind ,

o r according to a certain valuation in money

, ,
.

The parson f a parish r a gentleman o f sm all fortune w ho

o ,
o

lives upon his estate may sometimes perhaps find some

, , ,

advantage in receiving the one his tythe and the other his
, ,

rent in kind The quantity to be coll ected and the district

,
.
,

within which i t is to be c ollected are so small that they both ,

can oversee with their o w eyes the c ollection and disposal o f

,
n ,

every part o f what is due to them A gentleman o f great .

fortune who lived in the capital would be in danger o f suffer

, ,

ing much by the neglect and more by the fraud o f his factors
,

and agents if the rents o f an estate in a distant province were

,

to be paid to him in this manner The loss o f the sovereign .

from the abuse and depredation o f his tax gatherers would -

necessarily be mu c h greater The servants o f the most careles s .

private person are perhaps more under the eye o f their master
, ,

than those o f the most careful prince ; and a public revenue

which was paid in kind would su ffer so much from the mis
management o f the ollectors that a very small part o f what
c

w as levied upon the people would ever arrive at the treasury

o f the prince Some part o f the public revenue o f China how
.
,

ever is said to be paid in this manner The mandarins and

,
.

other tax gatherers will no doubt find their advantage in con

-

, ,

tinn ing the practice o f a payment which is so much more liable

t o abuse than any payment in money .

A tax upon the produce o f land which is l ev i ed in money may

be levied either according to a valuation which varies with all
the variations f the market pri c e o according to a fixed ,
or

valuation bushel Of wheat fo example being always valued

,
a ,
r ,

a t o e and the same money price whatever may be the state

n ,

o f the market The produ c e o f a tax levied in the former way

.

will vary only according to the variations in the real produce

o f the land according to the improvement o r neglect o f cultiva
,

tion The produce o f a tax levied in the latter w y will vary

. a ,

n o t only accor d ing to the variations in the produce o f the la d n

,
 Th e S o u r c e s of R ev en u e 32 1

but accordi ng to both those in the value o f the precious metals

a n d those in the quantity o f those metals which is at di ff erent

times contained in coin o f the same denomination The produce .

o f the fo r
mer will always h ea the same proportion to the v a l ue r

o f the real produce of the l nd The produce o f the latter may a .

,

at different times bear ve y different proportions to that val ue

,
r .

When instead either o f a ce rta in portion of the produce o f

,

land or of the price of a certa in portion a certa in sum of money

, ,

is to be paid m full compensation for all tax or tythe the tax ,

b ecomes in t his case exa tly of the same nature with the land
, ,
c

tax o f England It neither rises o falls with the rent o f the

. n r

land It neither encourages nor dis ourages improvement

. c .

The tythe in the greater part of those parishes which pay what
is ca lled a Modus in lieu f all other tythe is a t a x o f this k ind o .

Durin g the M ahometan government f Bengal instead of the o ,

payment in kind o f a fifth part of the produce a modus and , , ,

it is said a very moderate

,
e was established in the greater on ,

part f the districts zem indaries Of the ountry Some o f

o or c .

the servants f the East India Company under preten e f

o ,
c o

restoring the public revenue to its proper value have in some , ,

provinces exchanged this modus f a payment in kin d Under

,
or .

their management this change is likely both to discourage

cultivation and to give ew opportunities for abuse in the
,
n

collection f the public revenue whih has fallen ve ry mu h

o c c

below what it w said to have been when it fir st fell under the

as

man agement o f the company The servants f the company . o

may perhaps have profited by this ha ge but at the expense

, ,
c n , ,

it is probable both f their masters and f the country

,
o o .

Taxes upo n the Ren t 0 / Ho us es

The rent f a house may be distinguished into two parts o f
o ,

which the one may very properly be alled the Building rent ; c -

the other is ommonly called the Ground rent

c -

Th e building rent is the interest profit o f the capital

-

or

e xpended in buildi g the house In order to put the trade o f

n .

a builder upon a level with other trades it is necessary that this ,

rent should be uflic ie t fir st to pay him the same interes t

s n , ,

which he would have got f his capital if he had lent it upon or

good se uri t y ; and se ondly to keep the house in onsta nt

c ,
c ,
c

repair o r what comes to the sam e thing to replace within a

, , , ,

c erta i
n term of years the capital which had been employed in ,

building it The building rent or the ordinary profit o f bu ild

.
-

L 2
3 22 T he W eal t h of N at io n s
ing is therefore everywhere regulated by the ord i nary interest
, , ,

o f money Where the market rat e of interest is four per cent

. .

the rent of a house whi h over and above paying the ground
c ,

rent affords six o r six and a half per cent upon the whole
, .

expense o f building may perhaps aff ord a su fficient profit t o

,

the builder Where the market rate o f interest is five per cent
. .
,

it may perhaps require seven seven and a half per cent If or .

,

in proportion to the interest o f money the trade o f the builde ,

r

affords at any time a mu h greater profit than this it will soon

c ,

d raw so much capital from other trades as wil l reduce t he

profit to its proper level If it affords at any time much les s.

than this other trades will soon draw so much capital from it
,

as will again raise that profit .

Whatever part o f the whole rent o f a house is over and above

what is su fficient for affording this reasonable profit naturally
goes to the ground rent ; and where the own er of the ground
-

a d the owner o f the building are two diff erent persons is in

n , ,

most cases completely paid to the former This surplus rent

,
.

i s the price which the inhabitant f the house pays for some o

r eal supposed advantage f the situation In ountry houses

or o . c

a t a distan c e from any great town where there is plenty o f ,

ground t c hoose upon the ground rent is s arce anything o

o ,
-

c ,
r

n o more than what the ground which the house stands upon would

pay if employed in agriculture In country villas in the neigh .

b o u ho o d o f so m e great town it is sometimes a good deal higher

r , ,

and the peculiar conveniency or beauty of situation is there

frequently very well paid for Ground rents are generally .
-

highest in the capital and in those particular parts o f it where

,

there happens to be the greatest demand fo houses whatever r ,

be the reason o f that demand whether for trade and business , ,

for pleasure and society o for mere vanity and fashion ,

r .

A tax upon house rent payable by the tenant and p o

-

,
r

portioned to the whole rent o f each house ould o t f any ,

c n ,
or

considerable time at least affect the building rent If the ,

-

builder did not get his reasonable profit he would be obliged ,

to quit the trade ; whi h by raising the demand fo buildin g

c ,
r ,

would in a short ti me bring back his profit to its proper level

with that o f other trades N either would su h a tax fal l . c

altogether upon the ground rent ; but it would divide itself in -

su h a manner as to fall partly upon the inhabitant f the

c o

house and partly upon the owner o f the ground

,
.

Let us suppose for example that a partic ular person judges

, ,

that he can afford for house rent an expense o f sixty pounds a -

 Th e So u r c e s of R e v e n u e 3 3 2

year ;and let us suppose t o that a t ax o f four shillin gs m t he

,
o,

pound r f e fift h payable by the inhabitant is laid upon

,
o o on -

, ,

house rent A house of sixty pounds rent will m this case ost
-

. c

him seventy two pounds a year which is twelve pounds more

-

than he thinks he can afford He will therefore content him .

, ,

self with a worse house o a house o f fifty pounds rent which

,
r , ,

with the additional ten pounds that he must pay for the t ax ,

will make up the sum of sixty pounds a year the expense which ,

he judges he a fio d ; and in order to pay the tax he will

c n a r

give up a part o f the additional onveniency which he might c

have had from a house f ten pounds a year more rent He o .

will give up I say a part f this additional convenien y ; f r

, ,
o c o

he will seldom be obliged to give up the whole but will in , ,

consequence of the tax get a better house for fifty pounds a

,

year than he ould have got if there had been no tax F

c . o r as

a tax o f this k ind by taki ng away ,

th s
i parti ular competitor c ,

must diminish the compet ition for houses f sixty pounds rent o ,

so it must likewise diminish t fo those f fif ty pounds rent i r o ,

and the same manner for those f all other rents ex ept the
111 o ,
c

lowest rent for which it would for some time increase the c m
,
o

petition But the rents o f every las s o f houses for which the
. c

c ompetition w as dim i nished would necessaril y be more or less

reduced As no part o f this redu tion however could for any
. c , , ,

considerable time at le as t affect the build ing rent the whol e

,
-

o f it must in the long run ne essarily fall upon the ground rent c
- -

The final paym nt of this tax therefore would fall partly upon
e , ,

the inhabitant of the house who in order to pay his share , , ,

would be obliged to give up a part o f his convenien y and c ,

partly upon the owner o f the ground wh in order to pay his ,

o,

share would be obliged to give up a part f his revenue In

,
o .

what proportion this final payment would be divided between

them it is not perhaps very easy t as ertain The divisio o c . n

would probably be very different in d ifferent c ir umstan es c c ,

and a tax f this kind might ac ordin g to those different i

o ,
c c r

c um t a c e
s n fl c t very unequally both the inhabitant o f the
s, a e

house and the owner o f the ground .

The inequality with which a t a x o f this kind might fall upon

the ow ers o f d ifi t ground rents would arise altogether
n eren -

from the accidenta l inequality o f this division But the in .

equ al ity with which it might fall upon the inhabitants of diff erent
houses would arise not o nly from this but from another cause , .

The proportion o f the expense o f house rent to the whole ex -

pe n se o f living is d ifferent in the different degrees of fortune .

 3 24 Th e W e al t h of N at i o n s
It is perhaps highest in the highest degree and it diminishes ,

g radually through the inferior degrees so as in general to be ,

lowest in the lowest degree The necessaries of life occasion the .

great expense of the poor They find it d iflfc ult to get food .

and the greater part of their little v e ue i spent in getting it re n

'

s .

The luxuries and vanities o f life occasion the principal expense

o f the ri h and a magnificent house embellishes and sets o ff to
c ,

the best advantage all the other luxuries and vanities which
they possess A tax upon house rents therefore would in
.
-

, ,

g eneral fall heaviest upon the rich ; and in this sort o f inequality
there would not perhaps be anything very unreasonable It
, , .

is not very unreasonable that the ri c h should contribute to the

public expense not only in proportion to their revenue but
, ,

s omething more than in that proportion .

The rent o f houses though it in some respects resembles the

,

r ent f land is in one respect essentially different from it The

o , .

rent o f land is paid for the use o f a productive subject The .

land whi ch pays it produces it The rent o f houses is paid fo . r

the use f an unproductive subject N either the house nor the

o .

g round which it stands upon produce anything The person .

who pays the rent therefore must draw it from some other, ,

source of revenue distinct from and independent of this sub

j ec t .A tax upon the rent of houses so far as it falls upon ,

the inhabitants must be drawn from the same source as the

,

rent itself and must be paid from their revenue whether

, ,

d erived from the wages of labour the profits o f stock o the , ,

r

rent o f land So far as it falls upon the inhabitants it is one

.
,

o f those taxes whi h fall not upon o e only but indifferently

c ,
n ,

upon all the three different sources of revenue and is in every ,

respe t o f the same nature as a tax upon any other sort of

c

c onsumable commodities In general there is not perhaps any .

, ,

o e arti le Of expense o
n c c onsumption by whi h the liberality o r
r c

narrow ess o f a man s whole expense can be better judged o f

n
’

t han by his house rent A proportional tax upon this particu l ar

-

a rticle o f expense might perhaps produce a more considerable , ,

revenue than any whi h has hitherto been drawn from it in any
c

part o f Europe If the tax indeed was very high the greater
.
,

part o f people would endeavour to evade it as mu h as they ,

c

c ould by contenting themselves with smaller houses and by

, ,

turning the greater part o f their expense into some other hannel c .

The rent o f houses might easily be ascerta ined with sufficient

a ccura y by a policy o f the same kind with that which would
c

be necessary fo r as c erta ining the ordinary rent of land Houses .

 The S o u r c e s of R e v en u e 3 25

no t nhabited
i ought to pay no tax A tax upon them would .

fall altogether upon the proprietor who would thus be taxed ,

for a subject which afforded him neither conveniency o r n

revenue Houses inhabited by the proprietor ought to be rated

.
,

not accordin g to the expense which they might have cost in

building but according t o the rent which an equita ble arbitra
,

tion might judge them likely to brin g if leased to a tenant I f .

rated according to the expense whi c h they may have cost in

buil din g a tax o f three or four shillings i the pound joine d
,
n ,

with other taxes would ruin almost all the ri h and great
,
c

families o f this and I believe f every other civ ilised country

, , ,
o .

Whoever wil l examine with attention the different town and , ,

c ountry houses o f some o f the richest and greatest families in

this count ry will fin d that at the rate o f only six and a half ,

o r seven per cent upon the orig i nal expense o f buildin g their
.
,

house rent s nearly equ al to the whole net rent of their estates
-
1 .

It I S the accumulated expense o f several successive generatio n s ,

l aid o ut upon Objects of great beauty and magnificence in deed ; ,

but in proportion t o what they cost o f very small exchangeable

, ,

v alue .
1

Ground rents are a still more proper subject o f taxat ion than
-

t he rent o f houses A tax upon ground rent s would o t rais e

.
-
n

the rents o f houses It would fall altogether upon the owner

o f the ground rent w ho acts always as a m
.

-
onopolist and exacts
, ,

the greatest rent which can be g t for the use o f his ground o .

More o less can be got fo it accordin g as the competitors happen

r r

t o be richer o p oorer o r can aff ord to gr atify their fancy fo a

r ,
r

particular spot o f g ound at a greater or smaller expense Inr .

every country the greatest number o f rich competitors is in the

c apita l and it is there accordingly that the highest ground rents

,
-

are always t o be found As the wealth o f those c ompetitors .

would in no respect be increased by a tax upon ground rents -

they would not probably be disposed to pay more for the u se

o f the ground Whether the tax was to be advanced by t he
.

inhabitant or by the owner o f the ground would be o f littl e

, ,

importance The more the inhabitant was obliged to pay fo r

.

the tax the less he would incline to pay for the ground ; so
,

that t h e final payment o f the tax would fall altogether upon

the o wner o f the ground rent The ground rents of uninhabited -

.
-

houses ought to pay no tax .

Both ground rents and the ordinary rent f land are a spe c ie s
-

1
Si t h fi t p b li
n ce ti
e f t hi b
rs k t u ly p t h b vca on o s oo a a x n ear u on e a o e
m ti d p i ipl h b imp d
,

en one r nc es as een o se .
3 26 T he W e alt h of N at i o n s
o frevenue which the owner in many cases enjoys without any , ,

care o r attention o f his o w n Though a part o f this revenue .

should be taken from him in order to defray the expenses o f the

state o discouragement will thereby be given to any sort o f
,
n

industry The annual produ c e f the land and labour o f the

. o

s ociety the real wealth and revenue o f the great body of the
,

people might be the same after such a tax as before Ground

,
.

rents and the ordinary rent of land are therefore perhaps the , , ,

S pecies o f revenue which can best bear t have a peculiar tax o

imposed upon them .

Ground rents seem in this respect a more proper subject o f

-

, ,

p eculiar ta xation than even the ordinary rent of land The .

o rdinary rent o f land is in many cases owing partly at leas t to , ,

the attention and good management f the landlord A very o .

h eavy tax might discourage too much this attention and good
management Ground re nts so far as they exceed the ordinary
.
-

rent o f land are altogether owing to the good government of

,

the sovereign which by protecting the industry either of the

, ,

w hole people o r o f the inhabitants o f some particular place

, ,

enables them to pay so much more than its real value for the
g round which they build their houses upon ; or to make to its
o wner so mu c h more than co mpensation fo r the loss which he

might sustain by this use o f it N othing can be more reason .

a ble than that fund which owes its existen e to the good
a c

government o f the state should be taxed peculiarly or should ,

c ontribute somethin g more than the greater part of other funds ,

towards the support o f that government .

Though in many different countries o f Europe taxes have

, ,

been imposed upon the rent o f houses I do not know o f any in ,

which ground rents have been considered as a separate subject

-

o f ta xation The contrivers o f taxes have probably found

.
, ,

s ome d i flic ult y in ascertaining what part o f the rent ought to

be considered as ground rent and what part ought to be c o -

,
n

si d ed as building rent
er It should not however seem very
-

.
, ,

di flic ult to distinguish those two parts o f the rent from o n e

another .

In Great Britain the rent o f houses is supposed to be taxed

in the same proportion as the rent o f land by what is called
the annual land tax The valuation according to which each
-

.
,

d iff erent parish and distri t is assessed to this tax is always the c ,

same It was originally extremely unequal and it still c o

.
,
n

t iu es t o be 5 0
n Through the greater part o f the kingdom this
.

tax falls still more lightly upon the rent o f houses than upon
 Rev en u e
The S o ur c es of 3 7
2

that of land In some few districts o nly;which were originally

.

rated high and in which the rents o f houses have fallen con
,

side a b ly the land tax o f three o four shillings in the pound

r ,
-
r

is said t amount to an equal proportion f t he real rent Of

o o

houses Untena ted houses though by law subject to the t ax

. n , ,

a e in most distri t s
r ,
exempted from it by the favour of the
c ,

assessors ; and this exemption sometimes occasions some little

variation in the rate o f particular houses though that of the ,

d istrict is always the same Improvements o f rent by new .

,

buildings repairs etc go to the dis harge of the district which

, ,
. c ,

o ccasions still further variations in the rate of parti ular houses c .

In the province o f Holland every house is taxed at two and 1

a half per cent of its value without any regard either t

. the ,
o

rent which it actually pays to the cir umstance o f its being ,

or c

tenanted o untenanted Th ere seems to be a hardship in

r .

o bligi g the proprietor to pay a tax for an untenanted house

n ,

from which he can derive revenue especially so very heavy no ,

a tax In Holland where the market rate o f interest does not

.
,

e x eed three per cent

c t wo and a half per cent upon the whole .
,
.

value o f the house must in most cases amount to more than a , ,

t hird o f the buildi g rent perhaps o f the whole rent n The -

,
.

valuation i deed accordi g t o which the houses are rated

,
n ,
n ,

though very unequal is said to be always below the real value ,

.

When a house is rebuilt improved or enlarged there is a new , , ,

v aluation and the t a x is rated accord i

,
ngly .

The contrivers of the several taxes whi h in England have c ,

a t diff erent times been imposed upon houses seem to have

, ,

i magined that there was some great d ifliult y in ascerta ini g ‘

c n ,

with tolerable exa tness what was the real rent of every house
c
,
.

They have regulated their ta xes therefore a cording to some , ,

c

more obvious circumsta nce such as they had probably imagined ,

would in most cases bear some proportion to the rent

, ,
.

The first tax o f this k ind was hearth money o a tax o f two -

,
r

shillings upon every hearth In order t o ascertain how many .

hearths were in the house it was ne essa y that the tax gatherer ,
c r -

should enter every room in it This odious visit rendered the .

tax odious Soon after the revolution therefore it was abol ished
.
, ,

as a badge o f slavery .

The next tax o f this kind was a tax of t w shillings upon o

every dwelling house inhabited A house with ten windows to

-

pay four shillings more A house with twent y wi dows and . n

upwards t o pay eight shilli gs This tax was afterwards so far n .

1
Memo ir es c o nc er na nt les Dro i
ts , et c .
,
p . 223 .
32 8 Th e
W e al t h of N at i o n s
altered that houses with twenty w indows and with l ess than ,

thirty were ordered to pay ten shillings and those with thirty
, ,

windows and upwards to pay twenty shillings The number o f .

windows can i most cases be counted from the outs i de an d

,
n , , ,

in all cases without entering every room in the house The

,
.

visit o f the tax gatherer therefore wa s less offensive in this

-

, ,

t ax tha in the hearth money

n -

This tax was afterwards repealed and in the room o f i t was ,

established the window tax which has undergone t o o several -

, , ,

alterations and augmentations The window t ax as it stands .

-

at present (January over and above the duty o f three

shillings upon every house in England and o f o n e shilling upon ,

every house in Scotland lays a duty upon every window which , , ,

in England augments gradually from twopence the lowest rate

, , ,

U pon houses with n o t more than seven windows t o t w o shillings , ,

the highest rate upon houses with twenty five windows and
,
-
-

upwards .

The principal objection to al l such taxes is their inequality an ,

inequality o f the worst kind as they must frequently fal l much ,

heavier upon the poor than upon the rich A house o f ten .

pounds rent in a country town may sometimes have more

win dows than a house o f five hundred pounds rent in London ;
and though the inhabita nt o f the former is likely to be a much
poorer man than that o f the latter yet so far as his c o n t ibu ,
r

tion is regulated by the window tax he must contribute more -

to the support o f the state Such taxes are therefore directl y .

, ,

contrary to the first o f the four maxim s above mentioned .

They do not seem t o offend much against any o f the other thr ee .

The natural tendency of the window tax and o f all other -

t axes upon houses is to lower rents The more a man pays fo r

,
.

t he t a x the less it is evident he can aff ord t o pay for the rent
, , ,
.

Since the imposition Of the window tax however the rents o f -

, ,

houses have upon the whole risen more or less in almost every , ,

town and village o f Great Britain with which I am acquainted .

Such has been almost everywhere the increase o f the demand

fo houses that it has raised the rents more than the window
r ,

tax ould S ink them ; o e Of the many proofs o f the great

c n

prosperity o f the country and of the increasing revenue o f its ,

inhabita nts Had it o t been for the t ax rents wou l d probably

. n ,

have risen stil l higher .

 Th e S o ur c e s of R ev en u e 3 9
2

AR T CL II
I E

Taxes upon P ro fit, or u pon the Reven ue a ri

sin
g f
ro m S to c k
The revenue o r profit arising from stock naturally divides itse lf
into two parts ; that which pays the interest and which belongs ,

to the owner o f the stock and that surplus part which is over
,

and above what is necessary for paying the interest .

This l atter part o f profit is evidently a subject not ta xab le

directly It is the compens ation and in most cases i t is o
.
,
n

more than a very moderate compensation fo r the risk a d ,

n

trouble o f employin g the stock The employer must have this .

compensation otherwise he cannot consistently with his o wn

, ,

interest continue the employment If he w as taxed directly

, .
,

therefore in proportion to the whole profit he would be oblige d

, ,

either to raise the rate o f his profit o to charge the t a x upo n ,

r

the interest o f money ; that is to pay less interest If he raise d

,
.

the rate o f his profit in proportion to the t a x the whole tax , ,

though it might be advanced by him would be finally paid by ,

o e o r other o f t w o different sets o f people according to t he

n ,

different ways in which he might employ the stock o f which he

had the management If he employed it as a farming stock in
.

the cultivation o f land he could raise the rate o f his profit only
,

by retaining a greater portion o what comes to the sam e ,

r,

thing the price of a greater portion of the produce of the land

,

and as this could be done only by a redu tion o f rent the final c
‘

payment of t he t ax would fall upon the landlord If he em

‘

ployed it as a merc antile or manufa turin g stock he could rais e c ,

the rate o f his profit only by raising the price o f his goods ; in
which ca se the final payment o f the tax would fall altogethe r
upon the consumers o f those goods If he did o t raise t he . n

rate o f his profit he would be obliged to charge the whole t ax

,

upon that part o f it which w allotted for the interest o f as

money He could afford less interest for wha tever stock he

.

borrowed and the whole weight of the tax would in this cas e
,

fall ultimately upon the interest o f money So far as he could .

n o t relieve himself from the tax in the o e way he would be n ,

obliged to relieve himself in the other .

The interest f money seems at first sight a subject equally

o

ca pable o f being taxed directly as the rent o f land L ike t he .

rent o f land it is a net produce whi h remains after com

,
c

p le t ely compensatin g the whole risk and trouble o f employing

the stock As a t ax upon the rent of land cann ot raise rents ;
.
 Th e W eal t h of N at io i
is

b e c ause the net produce whi h remains after replacing the c

s tock o f the farm er together with his reasonable profit cannot

, ,

b e greater after the tax than before it so for the s ame reason , , ,

a
.
tax upon the interest o f money could not raise the rate o f
interest ; the quantity of stock or money in the country like ,

t he quantity of land be i ng supposed to remain the sam e after

,

the tax as before it The ordinary rate o f profit it has been .

,

s hown in the first book is everywhere regulated by the quan ,

t ity f stock to be employed in proportion to the quantity of

o

t h e employment or o f the business whi h must be done by it

‘

,
c .

B u t the quantity o f the employment or f the business to be ,

o

d one by stock ould neither be increased nor diminished by

,
c

an y t a x upon the interest of money If the quantity f the . o

s tock to be employed therefore was neither increased nor , ,

d iminished by it the ordinary rate f profit would ne c essarily

,
o

r emain the same But the portion of this profit ne ess ary fo r
. c

c ompensating the risk and trouble o f the employer would like

w ise remain the same that risk and trouble being in no respect ,

a ltered The residue therefore that portion whi h belongs to

.
, ,
c

t he owner o f the sto c k and which pays the interest f money ,

o ,

w ould necessarily remain the same too At first sight there .

,

f ore the interest of money seems to be a subj ect as fit to be

,

t axed directly the rent o f land

as .

There are however two different ir u mstances which render

, ,
c c

the interest o f money a much less proper subje t of direct c

t axation than the rent o f land .

First the quantity and value o f the land which any man
,

p ossesses can never be a se ret and ca always be ascertained c ,

n

w ith great exactness But the whole amount of the capital .

sto k whi h he possesses is almost always a secret and can

c c ,

s carce ever be ascertained with tolerable exactness It is liable .

,

besides to almost ontinual vari ations A year seldom passes

,
c .

a way frequently not a month sometimes scarce a single day

, , ,

i which it does
n t rise fall more r less An inquisition
no or o .

into every man s private circumstances and an inquisition

’
,

which in order to ac ommodate the tax to them wat hed over

,
c ,
c

a ll the flu tuations o f his fortune would be a source of such

c .

c ontinual and endless vexation as no people could support .

Secondly land is a subject which cannot be removed ; whereas

,

s tock easily may The proprietor f land is necessarily a citizen

. o

o f the particular country in which his estate lies The p o . r

p ie t
r r o f stock
o is properly a citizen o f the world and is ot ,
n

ecessarily attached to any parti c ular country He would be

n .
 Th e S o u r c e s of R ev en u e 33 I

apt to aban don the country in which he was exposed to a

vexatious inquisition in order to be assessed to a burdensome ,

tax and would remove his stock to some othe country where
,
r

he could either arry his business or enjoy his fortune more

“

c on ,

at his ease By removing his sto k he would put an end to

. c

all the industry which it had maintained in the ountry which c

he left Stock cultivates land ; stock employs labour A tax

. .

which tended to drive away stock from any parti ular ountry c c

would so far tend to dry up every source f revenue both to o

the sovereign and to the society N ot only the profits o f stock .

,

but the rent o f land and the wages f labour would necessarily o

be more o r les s diminished by its re moval .

The nations a cordingly who have attempted to tax t he

,
c ,

revenue arisin g from sto k instead f any severe inquisition o f c ,

o

this kin d have been obliged to content themselves with some

,

very loose and therefore more ,

less arbitrary estimation
, ,
or .

The extreme inequality and uncerta inty o f a t a x assessed in

this manner a be c mpensated only by its extreme modera
c n o

tion in consequence o f which every man finds himself rated so

,

very much below his real revenue that he gives hi mself little
d isturbance though his neighbour should be rated somewhat
lower .

By what is called the land tax in England it was intended -

that sto k should be taxed in the s me proportion as land

c a .

When the tax upon land was at four shillings in the pound o r ,

at one fift h of the supposed rent it was intended that stock

-

should be taxed at o fift h o f the supposed interest When the ne -

present annual land tax was first imposed the legal rate o f -

interest w a six per cent Every hundred pounds sto k accord

s . c ,

igly w as supposed to be taxed at twenty four s hi

n ,
llings the -

fifth part f six pounds Since the legal rate of interest has been
o .

r educed to five per ent every hundred pounds stock is supposed

c .

to be taxed at twenty shillings only The sum to be raised by .

what is alled the land t a x was divided between the ountry

c -

and the principal towns The greater part of it was laid upon .

the country ; and f what w laid upon the towns the greatero as ,

part was assessed upon the houses What remained to be .

as sessed upon the stock trade f the towns (f the stock or o or

upon the land was not m eant to be taxed ) was ve y much below r

the real value f that sto k o trade Whatever inequalities

o c r .
,

therefore there might be in the original assessment gave little

,

disturban ce Every parish and district still continues to be

.

rated for its land its houses and its stock a ording to the
, , ,
cc
332 The
W eal t h of N at i o n s
origin l assessment ; and the al most universal prosperity Of t h
a e
country which in most places has raised very much the value
,

of all these has rendered those inequalities of still l ess im

,

portance now The rate t o o upon each district continuing

.
, ,

always the same the uncertainty o f this tax so far as it might

, ,

be assessed upon the stock of any individual has been very ,

much diminished as well as ren d ered o f much less consequence

,
.

If the greater part o f the lands of England are n o t rated to t he

land tax at half their actual value the greater part o f the stock
-

o f England is perhaps scarce rat ed at the fiftieth part o f i

,
ts ,

actual value In some towns the whole land tax is assesse d

.
-

upon houses as in Westminster where stock and trade are

, ,

free It is otherwise in London

. .

In all countries a severe inquisition into the circumstances of

private persons has been carefully avoided .

At Hamburg every inhabitant l s obliged to pay to the state

1

o e fourth per cent of al l that he possesses

n -

and as the wealth

.
,

o f the people o f Hamburg consists principally in stock this ,

tax may be considered as a tax upon stock Every man assesses .

himself and in the presence o f the magistrate puts annual ly

, , ,

into the public coffer a certain sum o f money which he declares

upon oath to be one fourth per cent o f all that he possesses -

.
,

but without declaring what it amounts to o r being liable to any ,

examination upon that subject This tax is generally supposed .

t o be paid with great fidelity In a small republic where the .

,

people have entire confidence in their magistrates are convinced ,

o f the necessity o f the tax for the support o f the state an d ,

believe that it wil l be faithfully applied to that purpose such ,

conscientious and voluntary payment may sometimes b e

expected It is not peculiar to the peop l e of Hamburg
. .

The canton f U d e wald in Switzerland is frequently ravage d

o n r

by storms and inundations and is thereby exposed to extra ,

ordinary expenses Upon such occasions the people assemble.

,

and every o e is said to declare with the greatest frankness what

n

he is worth in order to be taxed accordingly At Z urich the .

l aw orders that in ases of necessity every one should be taxed

,
c ,

in propo rtion to his revenue— the amount of which he is oblige d

to declare upon oath They have o suspicion it is said that . n , ,

any o f their fellow citizens will deceive them At Bas il the -

principal revenue o f the state arises from a small custom upon

goods exported All the itizens make oath that they will pay
. c

every three months all the taxes imposed by the law All .

Mmi t l
1
D i t t m i p 74
e o r es co n cer n an es ro s. o e . . .
 Th e S o u r c e s of R ev en u e 333
merchants and even all in nkeepers are trusted with keeping
themselves the account o f the goods which they sell either
within r without the territory A t the end o f every three
o .

months they send this account to the treas urer with the amount
o f the tax computed at the bottom f it It is not suspected o .

that the revenue suffers by this c o nfide c e n .

1

To oblige every itiz en to declare publi ly upon oath the

c c

amount f his fortune must o t it seems in th ose Swiss cantons

o n , ,

be reckoned a hardship At Hamburg it would be reckoned .

the greatest Merchants engaged in the hazardous projects o f

.

tr ade all tremble at the thoughts of being obliged at all times

to expose the real state of their circumsta nces The ruin o f their .

credit and the mis c arriage o f their projects they foresee would , ,

too often be the co sequence A sober and parsimonious n .

people w h are strangers to all su h projects do o t feel that

,
o c ,
n

they have o c asion for a y su h c oncealment

c n c .

In Holland soon after the exalta tion f the late P rince o f

,
o

O range to the stadtholdership a tax f t w o per cent or the ,

o .
,

fiftieth pen y as it w as called was imposed upon the whole

n , ,

substa n e f every citizen Every c itizen assessed himself and

c o .

paid his tax in the same man er as at Hamburg ; and it w as n

in general supposed to have been paid with great fidelity The .

people had at that time the greatest affe tion f their new c or

government which they had just established by a general i

,
n

surre tion The tax w a to be paid but once in order to relieve

c . s ,

the state in a particular exigency It w as indeed too heavy .

, ,

to be permanent In a ount y where the market rate f

. c r o

in terest seldom exceeds three per cent a t a x of t w per ent .

,
o c .

amounts to thirteen shillings and fourpen c e in the pound upon

the highest net revenue whi h is ommo nly drawn from stock c c .

It is a tax whi h very few people c ould pay without en roaching

c c

more o less upon their capita ls In a parti ular ex igency the

r . c

people may from great publi zeal make a great e ffort and
,
c , ,

give up even a part of their capital order to relieve the sta te 111 .

But it is impossible that they should continue to do so for any

considerable time and if they did the tax would soon ru n
, ,
i

them so ompletely as to render them altogether in capable of

c

supporting the state .

The t ax upon sto k imposed by the Land tax Bill in England

c ,

though it is proportioned to the capital is not intended to ,

dimin ish ta ke away any part f that capital It is meant

or o .

o nly to be a t ax u pon the interest of money proportioned to

1
M mi e t l D i t t m i pp 63 66
o res co nc erna n 7 es ro s, o e . . 1 , 1 , 1 1.
334 W e al t T he
h of N a t i o n s
that upon the rent of l and so that when the latter is at fou , r

shillings in the pound the former may be at four hillings in t he

, S

pound t o o The tax at Hamburg and the still more moderate

.

taxes o f U d e wald and Z uri h are meant in the same manner

n r c , ,

to be taxes not upon the apital but upon the interest r net
,
c , o

revenue o f stock That of Holland was meant to be a tax upon

.

the capital .

Taxes u p
on the P ro fit o
fp a r ti
c u la r Emplo ymen ts

In s o me countrie s extraordinary taxes are imposed upon the

profits o f stock sometimes when employed in particular
,

branches o f trade and sometimes when employed in agriculture

, .

O f the former kind are in England the tax upon hawkers a d n

pedlars that upon h kn ey o c hes and chairs and that which

,
ac c a ,

the keepers o f ale houses pay fo a licence to retail ale and

-
r

S pirituous liquors During the late war another tax f the

.
,
o

same kind was proposed upon shops The war having been .

undertaken it was said in defence of the trade of the ountry

, ,
c ,

the mer hants who were to profit by it ought to contribute

c , ,

towards the support o f it .

A tax however upon the profits o f stock employed in any

, ,

particular branch o f trade c never fall finally upon the dealers an

(who must in all ordinary ases have their reasonable profit c ,

and where the competition is free a seldom have more than c n

that profit) but always upon the consumers who must be obliged
, ,

to pay in the price o f the goods the tax which the dealer d a

van es ; and generally with some overcharge

c .

A tax o f this kind when it is proportioned to the trade of the

dealer is finally paid by the onsumer and occasions no Opp e c ,
r s

sion to the dealer 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 o asions some

, ,
cc

Oppression to the small dealer The tax o f five shillings a week .

upon every hackney coach and that of ten shillings a year upon ,

every hackney chair so far as it is advanced by the different

,

keepers f such oaches and chairs is exactly enough pro

o c ,

portioned to the extent of their respective dealings It neither .

favours the great nor oppresses the smaller dealer The tax
,
.
.

of twenty S hillings a year for a licence to sell ale ; of forty shillings

for a li ence to sell spirituous liquors ; and of forty shillings more
c

for a licence to sell wine being the same upon all reta il ers must
, ,

necessarily give some advantage to the great and occasion som e ,

 Th e S o u rc e s of R e v en u e 335
oppression to the small dealers The former must find it more .

easy to get back the tax in the price Of their goods than t he
latter The moderation of the tax however renders this i
.
, ,
h

equality of less importance and it may to many people appear ,

n o t improper to give some discouragement to the multiplicatio n

of little ale houses The tax upon shops it w a intended should s

-

.
, ,

be the same upon all shops It could not well have been other .

wise It would have been impossible to proportion with tolerabl

. e

exactness the t ax upon a shop t o the extent of the trade carried

on in it without such an inquisition as would have bee n

al together insupportable in a free country If the tax had bee . n

considerable it would have Oppressed the small and force d

, ,

alm ost the whole retail trade into the hands o f the great dealers .

e competition o f the former being taken away the latte

T h ,
r

would have enjoyed a monopoly o f the trade and like all othe ,
r

monopol ists would soon have combined to raise their profit s

much beyond what was necessary for the payment o f the t a x
The final payment instead o f fallin g upon the shopkeeper
, ,

would have fallen upon the consumer with a considerable over ,

charge to the profit o f the shopkeeper For these reasons t he .

project f a tax upon shops was laid aside and in the room o f
o ,

it w as substituted the subsidy 75 9 ,

1 .

What in France is called the personal taille is perhaps the , ,

most importan t tax upon the profits o f sto k employed in c

agri ulture that is levied in any part o f Europe

c .

In the d isorderly state f Europe during the prevalence o f the

o

feudal government the sovereign w as obliged to content himself

,

with taxing those who were t o o weak to refuse to pay taxes

.

The great lords though willing t o assist him upon particular

emergenc es efied to subject themselves to any constant tax
,

i ,
r ls ,

an d he w as not strong enough to force them The occupiers o f .

land all over Europe were the greater part f them origin ally,
o ,

bondmen Through the greater part o f Europe they were

.

gradually emancipated Some of them acquired the property

.

o f landed esta tes whi h they held by so m e base or ignobl e

c

tenure sometimes under the king and so metimes u d r some

, ,
n e

other great lord like the ancient o p y holders of England

,
c -

Others without acquiring the property Obtained leases fo r

, ,

terms o f years o f the lands whic h they occupied under their

lord and thus became less dependent upon him Th gr eat
,
. e

lords seem to have beheld the degree o f prosperi t y and ih

de pendency whi h this inferior order o f men had thus come t o
c

enj oy with a mal ignant and contemptuous in dignation an d ,

336 Th e
W eal t h of N at i o n s
w il lingly consented that the sovereign shoul d tax them In .
‘

s ome countries this tax was confined to the lands which were
h eld i n property by an ignoble tenure ; and in this case the , ,

t aille was said to be real The land tax established by the late
.
-

K ing f Sardinia and the taille in the provinces o f Languedoc

o , ,

P rovence Dauphine and Brittany in the generality o f Mon

, , ,

t a ub a and in the ele tions of Agen and Condom as well as in

n, c ,

s ome other distri ts o f France c are taxes upon lands held in ,

p roperty by an ignoble tenure In other countries the tax was

.

l aid upon the supposed profits o f all those w ho held in farm o r

l ease lands belonging to other people whatever might be the ,

t enure by which the proprietor held them ; and in this case

t he taille w a s said to be personal In the greater part of those .

p rovinces of France which are called the Countries o f Elections

t he taille is of this The real taille as it is imposed only ,

u pon a part o f the lands o f the c ountry is necessarily an u n ,

e qual but it is not always an arbitrary t a x though it is so

, ,

u pon some occasions The personal taille as it is intended to

.
,

be proportioned to the profits of a c ertain lass o f people which c

ca only be guessed at is necessarily both arbitrary and unequal

n , .

In France the personal taille at present ( 775 ) annually 1

i mposed upon the twenty generalities called the Countries of

E lections amounts to livres 6 sous The pro ,
1 .
1

p ortion i which
n this sum is assessed upon those di f
f erent
provinces varies from year to year according to the reports
w hich are made to the king s council concerning the goodnes s
’

o r badness o f the crops as well as other circumstances which

,

may either increase o diminish their respective abilities to pay

r .

Ea h generality is divided into a certain number of elections

c ,

a d the proportion in which the sum imposed upon the whole

n

g enerality 5 divided
1 among those di ff erent ele tions varies like c

wise from year to year accordingto the reports made to the

council concerning their respective abilities It seems im .

p ossible tha t the council with the best intentions

,
can ever ,

proportion w i th tolerable exactness either o f those two assess

m ents to the real abilities o f the province district upon which or

they are respectively laid Ignorance and misinformation must

.

a lways more o r less mislead the most upright council The

, ,
.

p roportion which each parish ought to support o f what is

a ssessed upon the whole election and that which each individual ,

o ught to support of what is assessed upon his p articular parish ,

a e both in the same manner varied from year to year accord

r , ,

Mmi 1
e t l D i t t
o r es c o n c er na n t m ii p es ro s, e c o e . .
 T h e S o u r c e s of R e v e n u e 337
ing as circumstances are supposed to require These circum .

stances are judged of in the o e case by the office rs of the ,

n ,

election in the other by those f the parish and both the o e

,
o ,
n

an d the other are more o less under the direction and influenc e
,
r ,

o f the intendant N ot only ignorance and misinformation b ut

.
,

friendship party animosity and private resentment are said

, ,

frequently to mislead su h assessors N o man subje t to su h c . c c

a tax it is evident
,
ever be certain before he is assessed
,
c an , ,

of what he is t o pay He cannot even be certain after he is

.

assessed If an y person has been taxed w ho ought to have bee

. n

exempted o if any person has been taxed beyond his p o

,
r r

portion though both must pay in t he meantime yet if the y

, ,

c omplain and make good their complaints the whole parish i

,
s ,

r eimposed next year in order to reimburse them If any f the . o

contributors become bankrupt insolvent the collector i or ,

s

obliged to advance his tax and the whole parish is reimposed ,

next year in order t o reimburse the collector If the collecto r .

himself should become bankrupt the parish whi h elects him ,

c

must answer for his conduct to the receiver general o f t he -

election But as it might be troublesome for the receiver t

.
,
o

prose c ute the whole parish he takes at hi choice five o ix ,

s r s

o f the richest contributors and obliges them t o make good what

had been lost by the insolven y o f the collector The paris h c .

is afterwards reimposed in order to reimburse those five or six .

Su h eirn p o sit i s are always over and above the taille of t he

c r on

particular year in whi h they are laid o c n .

When a t ax is imposed upon the profits of stock in a parti

o n lar branch f trade the traders are all careful to bring o
o ,
n

more goods to market than what they c sell at a pri e su ffi an c

cient to reimburse them for advan in g the t ax Some of them c .

withdraw a part o f their stocks from the trade and the marke t ,

is more sparingly supplied than before The price of the good s .

rises and the fin al payment f the tax falls upon the consumer
,
o .

But when a tax is imposed upon the profits f stock employed o

in agricultu re it is o t the interest of the farmers t withdraw

,
n o

any part o f their stock from that employment Ea h farme . c r

occupies a ertain quantity f land for whi h he pays rent

c o ,
c

For the proper cultivation of this land a c ertain quantity o f

stock is necessary and by withdrawing any part f this meces
,
o

s ary quantity the farmer is not likely to be more able to p y

,
a

either the rent or the tax In order to pay the tax it c a .

,
n

never be his interest to diminish the quantity of his produ e c ,

n o r consequently to supply the market more sparin gly than .

 338 Th e W e al t h of N at i o n s
b efore The t ax therefore will never enable him to raise the
.
, , ,

p ri c e f his
o produ e so as to reimburse
c himself by throwi g the n

final payment upon the onsumer The farmer however must c .

, ,

h ave his reasonable profit as well as every other dealer other ,

w ise he must give up the trade After the imposition o f a tax .

‘
o f this kind he can get this reasonable profit only by paying
,

less rent to the landlord The more he is obliged to pay in the

.

w ay o f tax the less he can afford to pay in the w y of rent a .

A tax of this kind imposed during the currency o f a lease may ,

no doubt distress ruin the farmer Upon the renewal of the

,
or .

lease it must always fall upon the landlord .

In the countries where the personal taille takes place the ,

farmer is commonly assessed in proportion to the stock which

he appears to employ in ultivation He is upon this a ount c .
,
cc ,

frequently afraid to have a good team f horses oxen but o or ,

endeavours to cultivate with the meanest and m ost wretched

instruments of husbandry that he can Such is his dist ust in . r

the justi e of his assessors that he c ounterfeits poverty and

c ,

w ishes to appear s arce able t o pay anything for fear f being

c o

o bliged to pay too much By this miserable poli y he does not . c ,

p erhaps always
,
consult his w interest in the most e ffectual o n

m anner and he probably loses more by the diminution f his

,
o

p rodu e cthan he saves by that f his tax Though in c o se o .

,
n

q u en c f
e o this wretched ultivation the market is no doubt
c , , ,

s o m ewhat worse supplied yet the small rise o f pri e whi c h this
,
c

may o asion as it is not likely even to indemnify the farmer

cc , .

f or the diminution o f his produce it is still less likely to enable ,

him to pay more rent to the landlord The public the farmer .
, ,

the landlord all suffer more o less by this degraded cultivation

,
r .

That the personal ta ille tends in many different ways to dis , ,

c ourage cultivation and consequently to dry up the principal

,

s ource o f the wealth of every great country I have already had ,

occasion to observe in the third book o f this Inquiry .

What are called poll taxes in the southern provinces o f N orth

-

Am erica and in the West Indian Islands annual taxes f so

,
o

m u h a head upon every negro are properly taxes upon the

c ,

profits o f a ertain species f stock employed in agri ulture

c o c .

A the planters are the greater part o f them both farm ers and
s , ,

landlords the final payment of the tax falls upon them in their
,

q uality of landlords without any retribution .

Taxes o f so much a head upon the bondmen employed in

c ultivation seem anciently to have been common all over
E urope There subsists at present a tax o f this kind in the
.
 Th e S o u r c e s of R ev en ue 339
empire Of Russia It is probably upon this account that poll
.

taxes f all kinds have often been represented as badges o f

o

slavery Every t a x however is to the person who pays it a

.
, ,

badge t f slavery but f liberty

,
no o It denotes that he is ,
o .

subject to governm ent indeed but that as he has some pro , , ,

perty he cannot himself be the property of a master A poll

,
.

t a x upon slaves is altogether di fferent from a poll t a x upon -

freemen The latter is paid by the persons upon whom it is

.

i mposed ; the former by a different set f persons The latter o .

is either altogether arbitrary altogether unequal and in most or ,

cases is both the and the other ; the former though in some
one ,

respects unequal different slaves being of different values is in

, ,

no respe t arbitrary Every master who knows the nu mber o f

c .

his own laves knows exa tly What he has to pay Those
S c .

different taxes however being called by the same name have

, , ,

been considered as f the same nature o .

The taxes which in Holland are imposed upon men and maid
servants are taxes not upon sto k but upon expense and so ,
c , ,

far resemble the taxes upon consumable commodities The tax .

o f a guinea a head for every man servant which has lately been -

imposed in Great Britain is f the same kind It falls heaviest o .

upon the middling rank A man o f t w o hu d d a year may .

_
n re

keep a single man servant A man of ten thousand a year will -

not keep fifty It does not affe t the poor . c .

Taxes u p o t he profits of stock in particular employments

n
‘

can never affe t the interest f money N obody will lend his
c o .

money for less interest to those w h exercise the taxed than o

to those who exer ise the untaxed employments Taxes upon c .

the revenue arising from sto k in all employments where the c

government attempts to levy them with any degree o f exact

ness will in many cases fall upon the in terest f money The
, , ,
o .

Vingti eme o twentieth penny in France is a tax f the same

,
r ,
o

kind with what is alled the land tax in England and is ass essed
c -

, ,

in the same manner upon the revenue arising from land houses , , ,

and stoc k S far as it aff ects sto k it is as ses ed though not

. o c s ,

with great rigour yet with much more exa tness than tha t part
,
c

o f the land tax of England which is imposed upon the same

-

fund It in many ases falls altogether upon the interest o f

.
,
c ,

money Money is frequently sunk in France upon what are

.

called Contracts fo the constitution o f a rent ; that is per r ,

p et
a u l annuities redeemable at any time by the debtor upon
repayment Of the sum originally advanced but of which this ,

redemption is not exigible by the creditor except in particular

34 0 The W eal t h of N at i o n s
ca ses The Vingti eme seems not to have raised the rate
. of
those annuities though it is exactly levied upon them all
, .

APPE N DI X TO ARTI C L E S I . AND II .

Ta xes upo n the ta l Va lu e

Ca pi o f L a n d, Ho us es , an d S to c k

While property remains in the possession of the same person ,

whatever permanent taxes may have been imposed upon it ,

they have never been intended to diminish or take away any

part f its capital value but only some part o f the revenue
o ,

arising from it But when property changes hands when it is

.
,

transmitted either from the dead to the living from the ,

or

l iv ing to the living such taxes have frequently been imposed

,

upon it as necessarily take away some part o f its capital value .

The transference of all o rt s o f property from the dead to the

r

l iving and that of immovable property f lands and houses

, ,
o ,

from the living to the living are transa tions which are in their ,
c

nature either public and notorious o such as cannot be long ,

r

concealed Such transactions therefore may be taxed dire c tly

.
, , .

The transferen c e o f stock or movable property from the living , ,

to the living by the lending of m oney is frequently a se ret

, ,
c

transa tion and may always be made so It cannot easily

c ,
.
,

therefore be taxed directly It has been taxed indirectly in

,
.

t w o di fferent ways ; first by requiring that the deed containing ,

the obligation to repay should be written upon paper o par h r c

ment which had paid a certain stamp duty otherwise not to be -

valid ; se c ondly by requiring under the like penalty o f in

, ,

validity that it should be recorded either in a publi or secret

,
c

register and by imposing certain duties upon such registration

,
.

Stamp duties and duties o f registration have frequently been

-

imposed likewise upon the deeds transferring property of al l

kinds from the dead to the living and upon those transferring ,

immovable property from the living to the living transactions ,

whi c h might easily have been taxed directly .

The Vic e ima He edit a t um the twentieth penny f ihe i

s r ,
o n r

tances imposed by A ugustus upon the ancient Romans was a ,

t a x upon the transference of property from the dead to the

living Dion Cassius the author who writes concerning it the
.
,
1

least indistinctly says that it was imposed upon all su c cessions

, ,

legacies and donations in case of death except upon those t o

, ,

the nearest relations and to the poor .

1
Lib 5 5 S l B m D V tig lib P p R m p x i d
ee a so ur an , e ec a us o o ca an
h d D l impé t d i gtiem l
. . . . . .

’
Bo uc au ,
e i u v n e s ur es s u ccess o ns .
 T he S o u r c e s of R ev en u e 34 1

O f the same kin d is the Dut c h tax upon successions Colla .

1

t e al successions are taxed according to the degree of relation

r , ,

from five to thirty per cent upon the whole v al ue o f the suc .

cession Testamentary donations legacies to collaterals are

.
,
or ,

subject to the like duties Those from husband to wife .

,
or

from wife to husban d to the fiftieth penny The Luctuosa ,

.

Hereditas the mournful succession f ascendants to des endants

,
o c ,

to the twentieth penny only Dire c t su cessions o those o f . c ,

r

descendants to ascendants pay no tax The death o f a father ,

.
,

t o such o f his h i ldren as live in the same house with him is

c ,

seldom attended with any increase and frequently with a c o ,

n

si d b le diminution o f revenue by the loss o f his industr y

era , ,

o f his o fli o f some l i
c e, o rfe rent estate f whi h he m y have -

o c a

been in possession That t ax would be cruel and Oppres sive

.

which aggravated their loss by ta ki g from them any part o f n

his succession It may however sometimes be otherwise with

.
, ,

those children who in the lan guage of the Roman law are said
, ,

t o be emancipated ; in that f the Scotch law to be fori s o ,

fami lit d ; that is who have re eived their portion have got
a e ,
c ,

families f their o w and e supported b y funds separate an d

o n, ar

independent o f those o f their father Whatever part o f his .

s uccession might come to such children would be a real addi

tion to their fortune and might therefore perhaps without , , ,

more inconvenien y than what attends all duties f this kin d

c o ,

be liable t o some t a x .

Th e ualties o f the feud l law were taxes upon the tr ans

cas a

feren e o f land both from the dead to the living and from the
c , ,

livin g to the livin g In ancient tim es they constituted in every

.

part of Europe e o f the prin ipal bran hes of the revenue o f

on c c

the crown .

The he ir o f every immediate v sal Of the crow n paid a as

certa in duty generally a year s rent upon re eiving the investi

,
’
,
c

ture of the estate If the heir was a minor the whole rents f
.
, o

t h e estate duri ng the conti uance f the minori t y devolved t o n o

t he superior without any other charge besides the maintenance

o f the minor and the payment o f the widow s dower when ’
,

there happened to be a dowager upon the land When the .

minor came to be o f age another tax alled Relief was still , ,

c ,

due to the superior which generally amounted likewise to a ,

year s rent A long minorit y which in the present times so

’
.
,

frequently d isburdens a great estate of all its incumbrances and

restores the family to their ancient splendour could in those ,

M mi 1
e t l D i t t t m i p
o r es c onc er na n
5 es ro s, e c .
, o e . . 22 .
 34 2 T he W e al t h o f N at i o n s
times have o such e ffect The waste and not the d ii c um
n .
, s n

brance of the estate was the common e ffect o f a long minority

, .

By the feudal law the vassal could not alienate without t he

consent o f his superior w ho generally extorted a fine or c o m ,

position for granting it This fine whi h was at first arbitrary .

,
c
,

came in many countries to be regulated at a certain portion o f

the price o f the land In some countries where the greater part
.

of the other feudal ustoms have gone into disuse this tax upon
c ,

he alienation of land still conti ues to make a very considerabl e n

bran ch o f the revenue o f the sovereign In the canton o f Berne .

it is s high as a sixth part o f the price o f all noble fiefs and

o
,

a tenth part of that of all ignoble ones In the canton of .

1

Lucer e the tax upon the sale of lands is not universal and
n
,

takes place only in certain districts But if any person sells his .

land in order to of the territory he pays ten per ,

cent upon the whole pri c e o f the sale Taxes o f the same
. .
2

kind upon the sale either of all lands o of lands held by certain ,
r

tenures ta ke place in many other ountries and make a more

,
c ,

or less considerable branch o f the revenue of the sovereign .

Such transactions may be taxed indirectly by means either

of stamp duties o o f duties upon registration and those dutie s
-

,
r ,

either may o may not be proportioned to the value o f the

r .

subject which is transferred .

In Great Britain the stamp duties are higher or lower t -

,
no

so much according to the value o f the property transferred (an

ei g h t ee p e y o r
n half rown stamp
nn being sufficient upon a
-

bond
c

for the largest sum o f money ) as according to the nature of t he

deed The highest do o t exceed six pounds upon every shee t
. n

o f paper o skin o f parchment and these high duties fall chiefly

r ,

upon grants from the c rown and upon certain law proceedings , ,

without any regard to the value of the subje c t There are in .

Great Britain no duties o the registration f deeds o writings n o r ,

except the fees o f the o flic e s w ho keep the register and these r ,

are seldom more than a reasonable recompense fo their labour r .

The crown derives no revenue from them .

In Holland there are both stamp duties and duties upon

2 -

registration which in some c ases are and in some are

, ,

not proportioned to the value of the property transferred All

,
.

testaments must be written upon stamped paper of which the

price is proportioned to the property disposed o f so that there ,

are stamps which cost from threepence or three stivers a sheet , ,

to three hundred fl o is equal to about twenty seven pounds r n ,

-

Mm i
1
c t l D it t t m i p
o res co n c er na n 54 I bid pes 57 ro s, e c .
, o e . . 1 .
1
. . 1 .
 The S o u r c e s of R ev en u e 34 3
t en shillings o f our money If the stamp is f an inferior pric . o e

to what the testator ought to have made use o f his suc ession ,
c

is confiscated This is over and above al l their other taxes

. on

succession Exc ept bills o f exchange and some other mer

: ,

ca n t ile bills all other deeds bonds and contracts are subjec t
, , ,

t o a stamp duty This duty however does not rise in propor

-

.
, ,

tion to the value of the subject All sales f land and o f houses . o ,

and all mortgages upon either must be registered and upon , , ,

registration pay a duty to the state f two and a half per ent
,
o c .

upon the amount f the price or o f the mortgage This duty is o .

extended t o the sale of all ships and vessels o f more than t w o

tons burthen whether decked o r undecked These it seem s
,
.
, ,

are onsidered as a sort o f houses upon the water The ale o f

c s

movables when it is ordered by a court Of justi e is subje c t

.

c ,
,

to the like duty of two and a half per cent .

In France there are both sta mp duties and duties upon egis -
r

t ra t io The fo rmer are considered as a branch of the aide o r

n . s

excise and in the provinces where those duties take place a e

,
r

levied by the excise o flic e s The latter are considered s a r . a

bran h o f the domain of the rown and are levied by a d ifl e e t

c c ,
r n

set of o fficers .

Those modes of taxation by stamp duties and by dutie s upo n ,

-

registration are o f very modern invention In the ourse o f

,
. c

little more than a entury however stamp duties have i c , ,

-

,
n

Europe become hn t universal and duties upon registratio

,
a os ,
n

extremely common There is no art whi h one government . c

sooner learns o f another than that o f draini g money from the n

po kets f the people

c o .

Taxes upon the transferen e o f property from the dead t c o

the living fall finally as well as immediately upon the person

to whom the property is transferred Taxes up t h sale o f
'
'

. on e

land fall altogether upon the seller The seller is almost always .

under the ne essity of selling and must therefore take su h a

c , , ,
c

pri e as he
c get The buyer is scarce ever under the e
c an . n c es

s it y f buying and will therefore only give such a pri c e as h

o , , ,
e

likes He onsiders what the land will cost him in tax and
. c

pri e together The more he is obliged to pay in the w y f

c . a o

tax the less he will be disposed to give in the way of pri e

,
c .

Su h taxes therefore fall almost always upon a ne c essitou s

c , ,

person and must therefore be frequently very cruel and o p

pressive Taxes upon the sale o f new—
, , ,

. built houses where t he ,

building is sold without the ground fall generally upon the ,

buyer because the builder must generally have his profit

, ,
 34 4 Th e W eal t h of N a t i o n s
o therwise he must give up the trade If he advances the t a x .
,
t herefore the buyer must generally repay it to him
,
Taxes .

u pon the sale of Old houses for the same reas on as those upon ,

the sale of land fall generally upon the seller whom in most
, ,
.

cases either conveniency or necessity obliges to sell The .

umber of new built houses that are annually brought to

n -

m arket is more or less regulated by the demand Unless the .

d emand is such as to afford the builder his profit after paying ,

.
all expenses he will build no more houses The number f old
,
. o

h ouses which happen at any time to come to market is regu

lated by accidents o f which the greater part have no relation to
t he demand Two or three great bankruptcies in a mercantile
.

t own will bring many houses to sale which must be sold for
what can be got f them Taxes upon the sale o f ground rents
or .

fall altogether upon the seller for the same reason as those
S t a ni
,

u pon the sale of land p duties and duties upon

. the -

r eg istration of bonds and ontracts fo r borrowed money fall c ,

altogether upon the borrower and in fact are always paid by , , ,

hi m Duties o f the same kind upon law proceedings fall upon

.

the suitors They reduce to both the capital value o f the

.

s ubject in dispute The more it osts to acquire any property

. c
,
the less must be the net value o f it when a quired c .

All taxes upon the transferen e of property o f every kind so c ,

f a as they d i
r minish the capital value o f that property tend to ,

d iminish the funds destined for the maintenance of productive

labour They are all more or less unthrifty taxes that increase
.

t he revenue o f the sovereign which seldom maintains any but ,

unproductive labourers at the expense o f the capital of the ,

p eople which maintains

,
none but productive .

i
S u c h taxes even when they are proportioned to the value
,

o f the property transferred are still unequ al the frequency of , ,

t ransference not being always equal in property o f equal value .

When they are not proportioned to this value which is the ,

c ase with the greater part o f the stamp duties and duties o f
-

registration they are still more so They are in no respect

,
.

a rbitrary but are o may be in all cases perfectly lear and

,
r c

certain Though they sometimes fall upon the person who is

.

not very able to p ay the time of payment is in most cases,

sufficiently convenient for him When the payment be omes . c

due he must in most ases have the money to pay They are
,
c .

levied at very little expense and in general subject the c o n ,

t i rbu t o to no other in onveniency besides always the un

rs c

a voidable one oipaying the t ax .

 The S o u r c e s of R ev e n u e 34 5
—
In Fran ce the stamp duties not much complain ed f ar e o .

Those o f registration which they call t he Controle are Th ey , ,

.

give occas ion it is pretended to much extortion in the officers

o f the farm
, ,

ers general who collect the tax which is in a grea t

-

meas ure arbitrary and un certa i In the grea ter part f the n . o

li bels whi h have been written again st the present system f

c o

finances i Fran ce the abuses o f the Co ntr ole make a principal

n

arti le Uncertainty howev er does not seem to be nec essa ril y

c .
, ,

inherent in the nature f such taxes If the po pular comp l ain ts o .

are well founded the abuse must arise not so much from the
, ,

na tur e of the tax as from the want o f prec ision and distin ct
ness in the words o f t h edicts o r laws which impose it e .

The registration o f mortgages and in general o f all rights upo n ,

immovable property as it gives great security bo th to credito rs

,

and pur chasers is extremely advantageous to the public Tha t

,
.

o f the grea ter part o f deeds o f other kin ds is frequently i n

convenient and even dan gerous to individuals without any ,

a dvan tage to the pub l ic All registers which it is ack now .

,

l edged ought to be kept secret ought erta inly never t o exist

, ,
c .

The credit o f individuals ought certa inl y never to depend upo n

so very slender a security as the probity and religion o f the
inf erior O ffi ers f revenue But where the fees o f r egistration
c o .

have been mad e a source o f revenue to the sovereign regis t er ,

o ffices have commo ly been multiplied without end both for n ,

t he deeds which ought to be registered and for those which ,

ought not I Fra ce there are several different sorts f s ecret

. n n o

registers This abuse though not perhaps a ne e sary it must

.
,
c s ,

be acknowledged is a very nat ural effect o f such taxes

,
.

Such stamp duties as those in Engla d upon ca rds d die

-
n an c ,

upon newspapers and periodi cal pamphl ets etc are properly ,
.
,

taxes upon con u mption ; the fi al payment falls upo n the

s n

p e rsons who use o onsume such ommodities Su h sta mp

r c c . c

duties as those upon li ences to reta il ale wine and spirituous c

liquors though i tended perhaps to fall upon the profits of

, ,

, n , ,

the reta ilers are likewise fin ally paid by the onsum ers o f those
, c

liquors Su h taxe though lled by the same nam e d

. c s, ca ,
an

levied by the sam e o flic an d in the same man er w ith the er s n

stamp dutie above mentioned upon the transferen e o f prop erty

-
s c ,

are however of a quite difi e t nat ure d fall upo n quite

, , er n ,
an
di fferent funds .
34 6 T he W e al t h of N at i o n s

ARTI C LE III
Taxes u p on the Wages of L a bo ur
The wages of the inferior classes of workmen I have endeavoured ,

t o show i the first book are everywhere necessarily regulated

n ,

by two different circumstances the demand for labour and the , ,

ordinary or average price of provisions The demand for labour .

,

according as it happens to be either increas ing stationary o , ,

r

declining or to require an increasing stationary o declining

, , ,
r

population regulates the subsistence o f the labourer and

, ,

determines in what degree it shall be either liberal moderate , , ,

o r scanty The ordinary o r average price o f provisions deter

.

mines the quantity o f money which must be paid to the work

man i order to enable him e year with another to purchase
n ,
on ,

this liberal moderate o scanty subsistence While the demand

, ,
r .

for labour and the price f provisions therefore remain the same o , , ,

a direct tax upon the wages o f labour can have other e ffect no

than t raise them somewhat higher than the tax Let us

o .

suppose f exam ple that i a particular place the demand for

,
or ,
n

labour and the pri e o f provisions were su h as to render ten

c c

shillings a week the ordinary wages of labour and that a tax ,

o f o e—fift h or four shillings in the pound was imposed upo

n , ,
n

wages If the demand for labour and the pri e o f provisions

. c

remained the same it would still be ne c essary that the labourer

,

should in that place earn su c h a subsisten c e as could be bought

only for ten shillings a week or that after paying the tax he ,

should have ten S hillings a week free wages But in order to .

leave him su h free wages after paying such a tax the price o f
c ,

labour must in that place soon rise not to twelve shillings a ,

week only but to twelve and ixpence ; that is in order to

,
S ,

enable him to pay a tax of e fift h his wages must necessarily on -

soon rise o t e fift h part only but one fourth Whatever

,
n on -

,
-

w a s the proportion o f the tax the wages of labour must in all ,

cases rise not only in that proportion but in a higher pro

, ,

portion If the tax for example was o e tenth the wages o f

.
, ,
n -

labour must ne essarily soon rise not one tenth part only but
c ,
-

o e eighth
n -

A direct tax upon the wages of labour therefore though the , ,

labourer might perhaps p a y it out f his hand ould not properly o ,

c

be said to be even advan ed by him ; at least if the de mand c

for labour and the average price f provisions remained the same o

after the tax as before it In all such cases o t only the tax .
,
n
 Th e S o u r c e s of R ev e n u e 34 7
but something more than the tax would in real ity be advanced
by the person who immediately employed him The final pay .

m ent would I n d i fl e t cases fall u on different persons

p er n The .

rise which such a tax might occas ion in the wages of manu
fa t u i
c n
g labour
r would be advanced by the master ma nu

fa turer who would both be entitled and obliged to charge it

c , ,

with a profit upon the price f his goods The fi al pa yment

‘

,
o . n

o f this rise o f wages therefore together with the additional

, ,

profit of the master manufacturer would fall upon the consumer ,

.

The rise which such a tax might occasion in the wages of country
labour would be advanced by the farmer w h in order to ,
o,

m aintain t he same number o f labourers as before would be ,

obliged to employ a greater capital In order to get back this .

g reater capital together with the ordin ary profits o f stock

,
it ,

would be necessary that he should retain a larger portion o r ,

what omes to the same thing the pri e o f a larger portion o f

c ,
c ,

the produce f the land and consequently that he should pay

o ,

less rent to the landlord The final payment of this rise of wages .
,

therefore would in this case fall upon the landlord together

, ,

with the additiona l profit of the farmer who had advanced it .

In all c es a dire t tax upon the wages of labour must in t he

as c ,

long run o asion both a greater reduction in the rent of lan d

-

,
cc ,

and a greater rise in the pri c e f manufa tured goods than o c ,

would have followed fro m the proper as sessment f a sum equal o

to the produ e f the tax partly upon the rent o f land and
c o ,

partly upon consu mable ommodities c .

If direct taxes upon the wages f labour have not always o

o cc asioned a proportionable rise i those wages it is because n ,

they have generally o asioned a onsiderable fall in the demand

cc c

for labour The de lension of industry the decrease f employ

. c ,
o

m ent for the poor the diminution o f the annual produ e of the
,
c

land and labour o f the ountry have generally been the effe ts c ,
c

o f su h taxes c In consequen e f them however the pri e f

. c o , ,
c o

labour must always be higher than it otherwise would have been

in the a tual state of the demand and this enhancement f pri e
c : o c ,

together with the profit o f those w h advance it mu t lw y o ,

s a a s

be finally paid by the landlords and onsumers c .

A tax upon the wages o f country labour does t raise the no

pri e of the rude produce f land in proportion to the tax for

c o ,

the same rea on that a tax upon the farmer s profit does t
s
’
no

raise that pri e in that proportion c .

Absurd and destru tive as su h ta xes are however they take

c c , ,

pla e in man y countries In France tha t part o f the taille which

c
34 8 The W eal t h of N at i o n s
i s charged upon the industry workmen and day labourers in of -

country villages is properly a tax o f this kind Their wages '

are computed accord ing to the common rate o f the district in

whi ch they reside and that they may be as l ittle liable as
,

possible to any overcharge their yea rly gains are estimated at ,

no more than t wo hundred working days in the year The tax .

1

o f each in dividual is varied from year to year accordin g to

different circumstances f which the collector o r the com ,

o

missary whom the intendan t appoints to assist him are t he

judges In Bohemia in consequence o f the alteration in t he
.
,

system o f finances which was begun i 74 8 a ve ry heavy tax n 1 ,

is imposed upon the industry o f a r t i fie s They are divided c r .

i nto four cl asses The highest class pay a hundred fl is a

. or n .

year whi h at t w o and twenty pence halfpenny a fl o rin

c ,
- -

amounts to £9 75 6d The second clas s are taxed at seventy ;

. .

the third at fifty ; and the fourth comprehending a t ific e s in ,

r r

v ill ages and the lowest class o f those in towns at twenty fiv e

, ,
-

fl o ri
ns .
2

The recompense Of ingenious artists and o f men o f libera l

professions I have endeavoured to how in the first book n ec es
,
S ,

sa i
r ly keeps a ce rtain proportion t o the emoluments o f i nf erio r
trades A tax upon this recompense therefore could have o
.
, ,
n

other e ffect than to raise it somewhat higher than in proportion

t o the t a x If it did o t rise in this manner the ingenious arts
. n ,

and the liberal professions being no longer upon a level with ,

other trades would be so much deserted that they would soon

,

return to that l evel .

The emoluments o f o flic es are not like those of trades and ,

professions regulated by the free competition f the market

,
o ,

and do not therefore always bear a just proportion to what

, ,

the nature of the employment requires They are perhaps in .

, ,

most countries higher than it requires ; the persons who have

,

the administration of government being generally disposed t o

reward both themselves and their immediate dependants rathe r

more than enough The emoluments o f o ffices therefore can .

, ,

in most ases very well bear to be taxed The persons besides

c .
, ,

who enjoy publi o ffices especially the more lucrative are in

c , ,

all countries the obje ts o f general envy and a t x upon their c ,

a

emoluments even though it should be somewhat higher than

,

u pon any other sort of revenue is always a very popular tax ,

.

In England for example when by the land tax every other sort
, ,
-

M m i 1 t l D i t et t m p 08
o r es c o n cer n a n es ro s, e c o 11 1
i p 87
. . . . .
,

I bid t m i i 1
. o . . . .
 T h e S o ur c es of R ev e n u e 34 9
o revenue was supposed to be assessed at four shillings in the
f
pound it was very popular to lay a real tax o f five shill ings
,

an d S ixpe nce in the pound upon the salaries o f offices which

e xceeded a hundred pounds a year t he pensions o f the younger ,

c cers o f the arm y

b ran hes of the royal family the pay f the o ffi ,
o

an d navy and a few others less obnoxious to envy excepted

,
.

There are in England no other direct taxe s upon the wages o f

l abour .

ARTI CLE IV
Taxes whi t i
c h, i s in ten ded , s ho uld a ll i fi
n di er en tly p
u o n f every

fieren t S pec ies of Reven ue

di

The taxes which it is intended should fall ind ifferently upon

, ,

e very different spe ies of revenue are capitation taxes and

c , ,

taxes upon consumable commodities These must be paid in .

d ifferently from whatever revenue the contributors may possess ;

from the rent o f their land from the profits o f their s t ock or , ,

from the wages o f their labour .

o n Taxes
ta ti
Capi

Cap i tation taxes if it is attempted to proportion them to the

,

fortune revenue of eac h ontributor become al together arbi

or c ,

t a y
r r . The state of a man S fortune varies from day to day ’
,

a d without an inquisition more intolerable than any tax and

n ,

renewed at least once every year can only be guessed at His ,

.

assessment therefore must in most ases depend upon the good

, ,
c

o rbad humour of his assessors and must therefore be alto , , ,

gether arbitrary and uncertain .

Capitation taxes if they are proportioned not to the supposed

,

fortune but to the rank o f each contributor be ome altogether

, ,
c

u nequ al the degrees f fortune being frequently unequal in

,
o

the same degree f rank o .

Su h taxes therefore if it is attempted to render them equal

c , , ,

become altogether arbitrary and uncertain and if it is t ,

a

tempted to render them certain and not arbitrary become ,

a ltogether unequal Let the tax be light o heavy uncerta inty

. r ,

is always a great grievan e In a l ight tax a considerable degree

c .

o f inequality may be supported ; in a heavy o n e it is altogether

intolerable .

In the different poll ta xes which took place i Engl nd d uring

-
n a

t he reign o f William III the contributor s were the greater part

.
,
35 0 Th e W e al t h of N at i o n s .

of them assesse d according t o the degree o f their rank ; as

,

d uk es mar qui
,
sses earls viscounts barons esquires gentlemen
.
, , , , , ,

the eldest and youngest sons o f peers etc All shopkeepers and ,
.

tradesmen worth more than three hundred pounds that is the , ,

better sort o f them were subject to the same assessment ho w

, ,

great soever might be the difference in their fortunes Their .

ran k was more considered than their fo rtune Several f those . o

w ho i n the first poll t ax were rated according to their supposed

-

fortune were afterwards rated according to their rank Ser .

j ea t n
s attorneys
,
and proctors at l aw w
,
h o in the first po l l tax ,
-

w ere assessed at three shillin gs in the pound o f their supposed

income were afterwards assessed as gentlemen In the assess
,
.

ment o f a tax which was o t very heavy a considerable degree n ,

o f inequality had been found less insupportable than any degree

o f uncertainty .

In the capitation which has been levied in France without

a n y interruption since the beginning o f the present century the ,

highest orders o f people are rated according to their rank by an

invariable tariff ; the lower orders of people ac ording to what ,
c

is supposed to be their fortune by an assessment which varies ,

from year to year The offi ers of the king s court the judges
. c
’
,

and other officers in the superior courts o f justice the o fficers ,

of the troops etc are assessed in the first manner The inferior
,
.
,
.

ranks o f people in the prov inces are assessed in the second In .

France the great easily submit to a considerable degree o f i n

equality in a tax which so far as it affects them is not a very , ,

heavy one but could not brook the arbitrary assess ment of an
,

intendant The inferior ranks f people must in that country

. o , ,

suffer patiently the usage whi h their superiors think proper to c

give them .

In England the different poll taxes never produced the sum -

which had been expected from them o whi h it was supposed ,

r c , ,

they might have produ ce d had they been exactly levied In ,

.

France the capitation always produ c es the sum expe c ted from
it The mild govern ment o f England when it assessed the
.
,

different ranks f people to the poll tax contented itself with

o -

what that as sessment happened to produce and required no ,

c ompensation for the loss whi h the state might sustain either c

by those who could not pay o by those w h would not pay ,

r o

(for there were many such ) and w h by the indulgent exe c ution ,
o,

o f the law were not for c ed to pay

,
The more severe government .

o f France assesses upon ea c h generality a ertain sum whi h c ,

c

the intendant must find as he can If any province complains .

 The So u r c e s of R ev e n u e 35 1

of be ing as sesse d t o o high it may in the assessment o f next , ,

ye ar Obtain an abatement proportioned to the overcharge of

,

the year before But it must pay in the meantime The ih

. .

t endant in order to be sure o f finding the sum assessed upon

,

his generality wa empowered to assess it in a larger sum that

,
s

t he failure o r inability of some o f the contributors might be

compensated by the over harge of the rest and till 765 the c ,
1

fixation o f this surplus assessment w s left altogether to his a

discretion In that year indeed the council assumed this power

.
, ,

t o its elf In the capitation of the provinces it is observed by

.
,

the perfectly well informed author o f the Memoirs upon the

-

impo s itions in France the proportion which falls upon the ,

nobility and upon those whose privileges exempt them from

,

the ta ille is the least considerable The largest falls u p on those

,
.

subject to the taille who are assessed to the capitation at so

,

much a pound o f what they pay to that other tax .

Capitation taxes so far as they are levied upon the l ower

,

ranks f people are direct taxes upon the wages o f labour and
o , ,

are at t e d ed w it h all the inconveniences f such ta xes

n
'

o .

Capi t ation taxes are levied at little expense and where they , ,

are rigorously exacted afford a very sure revenue to the state,

.

It is upon this account that in countries where the ease o m ,

c

fort and security o f the inferior ranks of people are little

,

attended to capitation taxes are very common It is in general

,
.
,

however, but a small part of the public revenue whic h in a ,

g reat empire has ever been drawn fro m such taxes and the
greates t sum which they have ever afforded might always have
, ,

been found in some other w y much more convenient to the a

people .

Taxes u p on Co ns u mable C o mmo di

ties

The impossibility o f taxing the people in proportion to their ,

revenue by any apitat on seems to have given occas on to the

,
c i ,
i

invention of taxes upon onsumable ommodities The state c c .

,

not knowing how to tax directly and proportionably the , ,

revenue o f it subjects endeavours to tax it indire tly by taxing

s ,
c

their expense which it is supposed will in most cases be nearly

, , ,

in
proportion to their revenue Their expense is taxed by .

taxing the consumable commodities upon whi h it is laid out c .

Consumable ommodities are either necessaries or luxuries

c .

By ne essaries I understand not only the comm odities which

c

are indispensably necessary fo r the support of life but what ,

 35
.
z The W eal t h of N at i o ns
ever t he custom f the c ountry renders it ind ecent fo r credita ble
o

people even o f the lowest order to be without A lin en shirt

, , .
,

fo example is strictly S peaking not a necessary o f life

r , ,
The , . .

Greeks and Romans lived I suppose very comfortably though , ,

they ha d no linen But in the present times through t he .

,

greater part o f Europe a creditable day labourer would be ,

-

ashamed to appear in public without a linen shirt the want o f ,

which would be supposed to denote that disgraceful degree o f

poverty which it is presumed nobody can well fall into with
, ,

o ut extreme bad conduct Custom in the same manner has .

, ,

rendered l eather shoes a necessary Of life in England The .

poorest creditabl e person o f either sex would be ashamed to

appear in public without them In Scotland custom has .
,

rendered them a necessary o f life to the lowest order of men ;

but not to the same o rder o f women w ho may without any , ,

discredit wal k about barefooted In France they are nec es

,
.

sa ires neither to men n o to women the lowest rank o f both r ,

s exes appearing there publicly w i thout any discredit some , ,

times i wooden S hoes and sometimes barefooted Under

n ,
.

necessaries therefore I comprehend n o t only those things which

, ,

nature but those things which the established rules o f decency

,

have rendered necessary t o the l owest rank o f peopl e All other .

things I call l uxuries without meaning b y this appellation ,

to throw the smallest degree o f reproach upon the temperate

use o f them Beer and ale fo r example in Great Britain and
'

, ,
.
,

wine even in the w i ne countries I call luxuries A man of any

, ,
.

rank may without any reproach absta in totally from tasting

, ,

s uch liquors N ature does not render them necessary for the
.

support f life and custom nowhere renders it indecent to live

o ,

without them .

As the wages of labour are everywhere regu l ated partly by ,

the demand for it and partly by the average price o f the eces
,
n

sary articles o f subsistence whatever raises this average price ,

must necessarily raise those wages so that the labourer may

still be able to purchase that quantity o f those necessary articles
which the state of the demand for l abour whether increasing , ,

s t ationary o r declining requ ires that he should have A t ax

, ,
.
1

upon those articles necessarily raises their price somewhat higher

than the amount f the tax because the dealer who advances the o , ,

tax must generally get it back with a profit Such a tax must
,
.
,

therefore occasion a rise in the wages o f labour proportionable

,

t o this r ise of p ri ce .

S b ki h p 8 1
ee oo . c a . .
 Th e S o u r c e s of R ev en u e 35 3
It i s thus that a t a x upon the necessari es o f life operates
exactly in the same manner as a direct tax upon the wages o f

l abour The l abo urer though he may pay it out o f his han d
.
, ,

ca nnot for any considerabl e time at least be properly said even

, ,

to advan ce it It must always in the long run be advance d to

'

-
.

hi m by his immediate employer i n the advanced rate o f his

wages His employer if he is a manufacturer will charge upon

.
, ,

the price of his goods this rise o f wages together with a profit ; ,

so that the final payment f the t ax together with this over o ,

c harge will fal l upon the consumer If his employer is a farmer

the final payment together with a like overcharge wil l fall
,
.
,

, ,

upon the rent o f the landlord .

It is otherwise wi th taxes upon what I call luxuries even ,

upon those o f the poor The rise in the price of the taxed.

commodities will not necessarily occas ion any rise in the wages
o f labour A tax upon tobacco for example though a luxury
.
, ,

o f the poor as wel l as o f the rich w i

l l not raise wages Though ,
.

it is taxed in England at three times and in France at fifteen ,

times its original price those high duties seem to have no e ff ect
,

upon the wages of labour . The same thing may be said o f the
tax es upon tea and sugar which in England and Holland have ,

become luxuries of the lowest ranks o f people and o f those upon ,

chocolate which in Spain is said to have become so The

,
.

different taxes which in Great Brita in have in the course of the

present centurybeen imposed upon spirituous liquors are o t n

supposed to have had any effect upon the wages o f labour The .

r i se in the price o f porter occasioned by an addition al tax o f

,

thr ee shillings upon the barrel o f strong beer has not raised the ,

wages f common labour in London These were about eighteen

o .

penc e and twenty pence a day before the tax and they are n o t ,

more now .

The high pri e of such commodities does not necessarily

c

d iminish the ability f the inferior ranks of people to bri g up

o n

families Upon the sober and industrious poor taxes upon

.
,

such ommodities act as sumptuary laws and dispose them

c ,

either to moderate r to refrain altogether from the use o f

,
o

sup erflui es which they can no longer easily afford

ti Their .

ability to bring up families in onse quence f this for ed c o c

i
,

f rugality instead of
,
being di niihed is frequently perhaps n s , , ,

incre ased by the tax It is the sober and industrious poor

.

who generally bring up the most nu merous families and wh ,

o

principally supply the demand for useful labour All the poor .
,

i ndeed are not sober and industrious and the dissolute and
, ,

11 11 2
35 4 T he W e al t h of N at i o n s
disorderly might c ontinue t o i dulge themselves in the U e o f n s

su h commodities after this rise o f price in the same manner

c

as before without regarding the distress whic h this indulgence

might bring upon their famil ies Such disorderl y persons ho w .
,

ever seldom rear up numerous families their children generall y

, ,

perishing from neglect mismanagement and the scantiness or , ,

unwholesomeness f their food If by the strength o f their

o .

constitution they survive the hardships to whi c h the bad

condu t o f their parents exposes them yet the example o f
c ,

that bad conduct commonly corrupts their morals so that , ,

instead f being useful to so iety by their industry they become

o c ,

public nuisan es by their vices and disorders Though the

c .

advanced price of the luxuries of the poor therefore might , ,

in rease somewhat the distress of such disorderly fam ilies and

c ,

thereby diminish somewhat their ability to bring up children ,

it would not probably diminish much the useful population of

the country .

A n y rise in the average pr ice o f necessaries unless it is com ,

p e a
ns t d by a proportionable
e rise in the wages o f labour must ,

necessarily diminish more o less the ability o f the poor to brin g r

U p numerous families and conseq uently to supply the demand

,

for useful labour whatever may be the state of that demand

, ,

whether increasing stationary or declining o r such as requires

, , ,

an increasing sta tionary or de lining population

, ,
c .

Taxes upon l uxuries have no tendency to raise the price o f

any other commodities except that of the commodities ta xed .

Taxes upon necessaries by raising the wages o f labour ec es , ,

n

sa ily tend to raise the price f all manufactures and con

r o ,

sequently to diminish the extent o f their sale and consumptio n .

Taxes upon luxuries are finally paid by the consumers o f the

commodities taxed without any retribution They fall in .

differently upon every spe ies o f revenue the wages of labour c , ,

the profits o f stock and the rent o f land Taxes upon ec es

,
. n

sa ies so far as they affect the labouring poor are finally paid
r , , ,

partly by landlords in the diminished rent o f their lands and ,

partly by ri c h consumers whether landlords o others in the ,

r ,

advanced price of manufactured goods and always with a ,

considerable overcharge The advanced price o f such manu .

factures as are real necessaries o f life and are destined for the ,

consumption of the poor o f coarse woollens for example must , , ,

be o mpensated to the poor by a further advancement o f their

c

wages The middling a d S uperior ranks o f people if they

. n ,

understood their o w interest ought always to Oppose all taxes

n ,
:
 T h e S o u r c e s of R ev en u e 35 5
upon the necessaries f life as well as all dire t taxes upon the o ,
c

wages f labour The final payment o f both the e and the

o . on

other falls altog ether upon themselves and always with a con ,

si d b le Over harge
er a They fall heaviest upon the land l ords
c .
,

w h always pay in a double apa c ity ; in that o f landlords by

o c

the reduction f their rent and in that o f ri c h consumers by o ,

the increase o f their expense The Observation of Sir Matthew .

De ker that ertain taxes are in the price of certain goods

c ,
c , ,

sometimes repeated and ac umulated four or five times is c ,

perfectly just with regard to taxes upon the ne essaries o f life c .

In the price f leather for example you must pay not only o , ,

for the tax upon the leather o f your o w hoes but for a part n S ,

o f that upon those of the shoemaker and the tanner Yo u .

must pay t for the tax upon the salt upon the soap and upon
,
oo, , ,

the candles which those workmen onsume while employed in c

your servi e and for the tax upon the leather whi h the salt
c ,
c

maker the soap maker and the candle maker onsume while
,
-

,
-

employed in their ser i e v c .

In Great Britain the prin ipal taxes upon the necessaries ,

c

o f life are those upon the four ommodities just w mentioned c no ,

salt leather soap and andles

, , ,
c .

Salt is a very ancient and a very universal subje t of taxa c

tion It w taxed among the Romans and it is o at present

. as ,
s

i n ,
I believe every part of Europe The quantity annually ,
.

consu med by any individual is so small and may be purc hased ,

so gradually that nobody it seems to have been thought ould

, , ,
c

feel very sensibly even a pretty heavy tax upon it It is in .

—
England taxed at three shillings and fourpence a bushel about
three times the original price f the ommodity In so me other o c .

countries the tax is still higher Leather is a real necessary f . o

life The use o f linen renders soap such In countries where

. .

the winter nights are long andles are a ne essary instrument ,

c c

o f trade Leather and soap are in Great Britain taxed at three

.

halfpence a pound candles at a penny ; taxes whi h upon the ,

c ,

original pri e o f leather may amount to about eight o ten per

c ,
r

cent ; upon that of soap to about twenty or fi e and twenty

. v - -

per ent and upon that of andles to about fourteen fifteen

c . c or

per ent taxes which though lighter than that upon salt are
c .
, ,

still very heavy As all those four ommodities are real meces . c

sa i
r e o f life su h heavy taxes upon them must in re se some
s ,
c c a

what the expense o f the sober and industrious poor and must ,

consequently raise more or less the wages o f their labour .

In a country where the winters are so cold as in Great Britain ,

35 6 T he W e al t h of N at i o n s
fuel is during that season in the strictest sense of the word
, , ,

a necessary o f life not only fo r the purpose of dressing victuals

, ,

but fo the comfortable subsistence o f many different sorts of

r

workmen w h work within doors ; and c oals are the c heapest

o

of all fuel The pri c e o f fuel has so important an influence

.

upon that o f labour that all over Great Britain manufacture s

have confined themselves principally to the coal countries other ,

parts o f the ountry on account o f the high pri e o f this e es

c ,
c n c

sary article o t being able to work so cheap In some manu

,
n .

factures besides coal is a ne essary instrument o f trade as in

, ,
c ,

those f glass iron and all other metals If a bounty ould in

o , ,
. c

any case be reasonable it might perhaps be so upon the trans ,

p o rt a t io o f coals
n from those parts o f the country in which they
abound to those in whi c h they are wanted But the legis .

l t u e instead o f a b o u t y has imposed a tax o f three shillings

‘ "

a r ,
n ,

and threepence a ton upon coal carried coastways which upon ,

most sorts o f coal is m ore than S ixty per ent Of the original c .

price at the coal pit Coals carried either by lan d o r by inland

-

navigation pay no duty Where they are naturally cheap they .

,

are consumed duty free : where they are naturally dear they ,

are loaded with a heavy duty .

Such taxes though they raise the price o f subsisten e and

,
c ,

consequently the wages of labour yet they afford a considerable ,

revenue to government whic h it might not be easy to find in

any other w y There may therefore be good reasons for
a .
, ,

contin uing them The bounty upon the exportation of corn

.
,

so far as it tends in the actual state of tillage to raise the price

o f that ne essary article produces all the like bad e ff ects and
c , ,

instead o f affording a y revenue frequently occasions a very n ,

g reat expense to government The high duties upon the im .

p o rt at i o Of foreign
n corn which in years o f moderate plenty ,

amount to a prohibition and the absolute prohibition o f the ,

importation either o f live cattle o o f salt provisions which r ,

ta kes plac e in the ordinary state of the law and whi h on ,

c ,

account o f the scarcity is at present suspended for a limited ,

time with regard to Ireland and the British plantations have ,

all the bad e ffects o f taxes upon the ne essaries o f life and c ,

produce no revenue to gover ment N othing seems necessary n .

for the repeal o f such regulations but t o convince the public o f

the futility of that system in consequence o f which they have
been established .

Taxes u pon the necessaries o f life are much higher in many

other countries than in Great Brita in Duties upon flour and .
 Th e S o u r c e s of R ev en u e 35 7
meal when ground at the mil l an d upo n bread when baked at ,

the oven take pla e in many countries In Holland the money

,
c .

price of the bread onsumed in tow is supposed t o be doubled

c ns

by mean o f such taxes In lieu of a p art o f them the people

'

s .
,

w ho l ive in the country pay every year so much a head accord

i ng t o the sort o f bread they are supposed t o consume Those .

w ho consume wheaten bread pay t hree guilders fifte en stivers

about six shillings and ninepence halfpen y These and some n .
,

other taxes o f the same kind by raising the price of labour are , ,

said t o have ruined the gr eater part o f the manufactures o f

Holland Similar tax es though not quite so heavy ta ke place
.
1
, ,

in the Milanese in the states o f Genoa in the duchy o f M o dena

, , ,
in the duchies o f Parma Placentia and Guastall a and in the , , ,

ecclesi astical state A French author o f some note has p o

.
2
r

posed t o reform the finances o f his country by substituting in the

room o f the greater part of other taxes this most ru inous of all
taxes There S no t hing so absurd says Ci ero which has n o t
. I ,
c ,

sometimes been asserted by some philosophers .

Taxes upon butc hers meat are still more ommon than those ’
c

upo n bread It may indeed be doubted whether butchers meat

.
’

is anywhere a necessary of life Grain and other vegeta bles .

,

with the help o f milk cheese and butter o r o il where butt er , , ,

is not t o be had it is known from experience can without an y

, , ,

butche s meat afford the most plentiful the most wholesome

r
’
, , ,

the most nourishing and the most invigorating diet De ency ,

. c

nowhere requires that an y man should eat butchers meat as it ’

,

in most pl aces requires that he should wear a linen shirt o r a

pair o f leather S hoes .

Co nsumable c ommodities whether nece ssaries or luxuri es , ,

may be taxed in two d ifie e t ways The consumer may either r n .

pay an ann ual sum o ac ount o f his using o co suming goo ds n c r n

o f a certain kind o the goods may b e taxed while they remain

,
r

in the hands o f the dealer and before they are de livered to the ,

cons umer The consumable goods whih last a considerable

. c

time before th ey are consumed altogether are most properly

taxed in the o e w y; those of which the con umption is
n a s

either immediate o r more speedy in the o t her The coach tax , .

-

and plate tax are examples o f the former method f im p osing :

-
o

the greater part of the other duties o f excis e and customs o f ,

the latter .

A co ach may with good management last ten o twelve

, ,
r

Mm i 1
t l D i
e t t pp 0
o res co ncer n a n es ro s , e c. , . 21 , 21 1 .

1
L e Refor ma teur.
35 8 The W e al t h o f N at i o n s
years It might be taxed once for all before it comes o ut of
.
, ,

the hands f the coa hmaker But it is certainly more con

o c .

ven e t for the buyer t o pay four pounds a year for the privilege
i n

of keeping a coa h than to pay all at once forty or forty eight

c

pounds additional price to the coachmaker o r a sum equivalent ,

to what the tax is like ly to cost him during the time he uses
the s ame c oac h A servi e o f plate in the same manner may
. c , ,

last more than a century It is c ertainly easier for the o . c n

sumer to pay five shillings a year for every hundred ounces of

plate near one per cent o f the value than to redeem this long
,
.
,

a n nuity at fiv e and twenty o r thirty years purchase which ’

- -

would e n hance the price at l east fiv and twenty o r thirty per e - -

c ent . The different taxes which aff ect houses are certainly more
c onveniently paid by moderate annual payments than by a
heavy tax of equal v lue up the first building o r sale o f the a
‘

on

house .

It was the well known p Op o sal o f Sir Matthew Decker that

-
r

all c o mmo d it ies e e tho e o f which the consumption is either

y
v n s

immediate o very speedy should be taxed in this manner the

r , ,

dealer advancing nothing but the consumer paying a certain ,

annual sum for the licence to consume certai goods The n .

object o f his scheme w as t o promote all the different branches

o f foreign trade particularly the carrying trade by taking away
, ,

all duties upon importatio and exportation and thereby n ,

enabling the merchant to employ his whole capita l and credit

in the pur hase o f goods and the freight of ships no part of
c ,

either being diverted towards the advancing o f ta xes The .

project however o f ta xing in this manner goods o f immediate

, , , ,

or speedy consumption seems liable to the four following very

importa nt obje tions First the tax would be more unequal
c .
, ,

or not so well proportioned to the expense and consumption o f

the different c ontributors as in the way in whi h it is c ommonly c

imposed The taxes upon ale wine and spirituous liquors

.
, , ,

whi h are advanced by the dealers are finally paid by the

c ,

different consumers exactly in proportion to their respe tive c

consumption But if the tax were to be paid by purchasing a

.

licence t o drink those liquors the sober would in proportion to , ,

his consumption be taxed much more heavily than the drunken

,

consumer A family which exercised great hospitality would

.

be taxed mu c h more lightly than who entertain ed fewer o ne

guests Secondly this mode o f taxation by payin g for an

.
, ,

annual half yearly o quarterly licence to c onsume certain

,
-

,
r

goods would d imiislivery much e o f the principal c o

,
n on n
 The So u r ce s Of R ev e n u e 35 9
veni en ces of taxes upon goods o f S pee d y c o summ i
on
.

— the n

piecemeal payment In the price o f threepence halfpenny

.

.
,

which is at present paid for a p o t o f porter the different taxes ,

upon mal t hops and beer together with the extraordinary

, , ,

profit whi h the brewer charges fo having advanced them may

c r ,

perhaps amount to about three halfpence If a workman can .

conveniently spare those three halfpence he buys a po t o f ,

porter If he ca nnot he contents himself with a pi t d as

.
,
n ,
an ,

a pe ny saved is a penny got he thus gain s a farthing by hi

n s ,

temperan ce He pays the tax piecemeal as he can afl o rd to

.

p y
a it and
,
when he can aff ord to pay it and every act o f ,

payment is perfectly voluntary an d what he can avoid if he ,

chooses to do so Thirdly such taxes would Operate less as

.
,

sumptuary laws When the licence was once purchased whether

.
,

the purchas er dr an k much r dr ank little his tax would be the o ,

same Fourthly if a workman were to pay all at once by

.
, ,

yearly half yearly or quarterly payments a tax equal to what

,
-

, ,

he at present pays with little o r no inconveniency upon all the

, ,

di fie en t pots and pints o f porter whi h he drinks in any such

r c

period o f time the sum might frequently distres s him very

,

much This mode o f ta xation therefore it seems evident

.
, , ,

could never without the most grievous Oppres sion produce a

, ,

revenue nearly equal to what is derived from the present mode

wi thout any Oppression In several countries however com .
, ,

mo di ti es o f an immediate o very S peedy consumption are taxed r

in this manner In Holland people pay so mu h a head for a

. c

licence to drink tea I have already mentioned a tax upo n .

brea d whi h S far as it is consumed in farm houses and

,
c ,
O -

countr y villages is there lev ied in the same manner

,
.

The duties f excise are imposed chiefly upo n goods o f home

o

produce desti ed for home consumption They are impos ed

n .

only upon a few sorts of goods f the most general use There o .

can never be any doubt either concernin g the goods which e ar

subject to those duties o concernin g the particular duty whi h ,

r c

each pe ies Of goods is subject to They fall almost altogether

S c .

upon what I c all luxuries exceptin g always the four duties ,

ab ove mentioned upon salt soap leather candl es d perhaps ,

, , , , ,
an ,

that upon green glass .

The duties Of ustoms are much more an cient than those f

c o

excise They seem to have been called c ustoms as denoting

.

cu stomary paym ents whi h had been in use f om time imme c r

morial They appear to have been originally considered as

.

taxes upon the profits o f merchants During the barbarous .

360 The
W eal t h of N a t i o n s
times f feudal anarchy merchants like all the other
o , ,
n hab i
i
tants o f burghs were considered as little better than eman ei
,

pated bondmen whose persons were despised and whose gains

, ,

were envied The great nobility who had consented that the
.
,

king S hould tallage the profits f their wn tenants were not o o ,

unwilling that he should tallage likewise those of an order o f

men whom it was much less their interest to protect In those .

ignorant times it wa s o t understood that the profits o f mer

n

chants are a subject not taxable directly o that the final ,

r

payment of all such taxes must fall with a considerable over ,

charge upon the consumers

,
.

The gains o f alien merchants were l ooked upon more un

favourabl y than those o f English merchants It w as natural .
,

therefore that those o f the former should be taxed more heavily

,

than those o f the This distin ction between the duties

upon aliens and those upon English merchants which w s begun ,
a

from ignorance has been continued from the spirit o f monopoly

, ,

o r in order to give o ur o wn merchants an a d vantage both i n

t he home and in the foreign market .

With this distinction the ancient d uti es o f customs were

,

imposed equally upon all sorts o f goods necessaries as well as ,

luxuries goods exported as well as goods imported Why should

,
.

the dealers in o e sort of goods it seems to have been thought

n , ,

be more favoured than those in another ? o r why should the

merchant exporter be more favoured than the merchant importer ?
The ancient c ustoms were divided into three branches The .

fir st and perhaps the most ancient o f all those duties was that
, ,

u pon wool and leather It seems to have been chiefly or alto

.

gether an exportation duty When the woollen manufacture .

ca me to be established in England lest the king should lose any ,

part o f his customs upon wool by the exportation o f woollen

c loths ,
a like duty was imposed upon them The other t wo .

branches were first a duty upon wine which be ing imposed

, , , ,

a t so much a t w as called a tonnage ; and se ondly a duty

o n, ,
c ,

upon all other goods which being imposed at so much a pound

, ,

o f their supposed value w as called a poundage ,

In the forty .

seventh year o f Edward III a duty o f S ix pence in the pound .

w as imposed upon all goods exported and imported except ,

wools wool fells leather and wines which were subject to

,
-

, , ,

particular duties In the fourteenth f Richard 11 this duty

. o .

was raised t o o e shilling i the pound but three y ears after

n n ,

wards it was again reduced to ixpence It was raised to eight S .

pence in the second year o f Henry IV and in the fourth ye ar .

,
 The S o u r c e s o f R ev en u e 36 1

of t hesame prin ce t o o n e shill in g From th is t ime to the ninth .

year o f Wil l iam III this duty continued at o e shilling in the

. n

po und The duties o f tonnage and po undage were generally

.

granted t o the king by o e and the same act o f parliament an d n ,

were called the Subsidy o f Ton age and Poundage The sub n .

s idy of oundage hav in g continued for so l ong a time at o e n

p
shill i g i t h e pound or at five per cent a subsidy ca me in
n n ,
.
, ,

the language o f the customs to denote a general duty of this ,

kind o f five pe cent This subsidy which is now called the

r .
,

O ld Subsidy still continues to be levied accor di g to the book

,
n

o f rates es tablished i n the twe l fth o f Charles II The method .

o f ascertai ning by a book of rates the value o f goods subject

, ,

to t his duty said t o be older than the time o f James I The

18 .

new subsidy imposed by the n inth and tenth o f William III .

was an additional five pe ent upon the greater part o f goods r c . .

The one third an d t he two third subsidy made up between them

- -

an other five pe cent o f whi h they were proportionable parts

r . c .

The subsidy o f 74 7 made a fourth five per cent upon the

1 .

greater part o f goo ds ; and that o f 75 9 a fif th upon some 1

particular sorts o f goods Bes ides those five subsidies a great .

,

variety of other duties have occas ionally been imposed upon

parti cul ar sorts o f goods in order sometimes t o relieve the ,

exigencies o f the state an d sometimes to regulate the trade o f ,

t h country accordi g to the principles f the merca ntile system

e n o .

That system has come gradually more and more into fas hion .

The o ld subsidy w imposed indifferently upon expo rtation as

as

well as impo rtation The four subsequent subsidies as well as

.
,

t he other duties which have sin c e been occasionally impo sed

upon parti ular sorts o f goods have with a few excep t ion been
c ,
s,

l aid altogether upon impo rta tion The greater part o f the .

an cient duties which had been imposed upon the exportation f o

the goods o f home produce and manufacture have either been

lightened o r taken away altogether In most cas es they have .

b een taken away Bounties have even been given upon the
.

expo r tation o f some o f them Drawbacks t o o sometimes o f the .

,

whole and in most cas es o f a part of the duties whic h are

, , ,

paid upo n the im p o rta tion of foreign goods have been gran ted ,

upon their exportation O nly half the duties impo sed by the .

o ld subsidy upon importation are drawn back upon exportation :

but the whole o f those imposed by the latter subsidies and

other imposts are upo n the greater part o f g oo ds drawn back
, ,

in the same mann er This growing favour f exporta tion and. o ,

d i sco uragement o f impo rtation have suff ered only a few excep ,
362 Th e We al t h o e at i
o ns

tions which chiefly concern the materials f some ma ufac

, o n

tures These our merchants and manufacturers are w illing

.

should come as heap as possible to themselves and as dear

c ,

as possible to their rivals and competitors in other countries .

Foreign materials are upon this account sometimes allowed to

, ,

be imported duty free ; Spanish wool f r example flax and ,

o , ,

raw linen yarn The exportation o f the materials o f home pro

.

duce and Of those which are the particular produce o f ur

,
o

colonies has sometimes been prohibited and sometimes sub

, ,

j e t ed to higher duties The exportation of English wool has

c .

been prohibited That o f beaver kins o f beaver wool and o f

. S , ,

gum Senega has been subjected to higher duties ; Great Brita in ,

by the onquest f Canada and Senegal having got almost the

c o ,

monopoly of those ommodities c .

That the mercantile sys tem has n o t been very favourable to

the revenue of the great body o f the people to the annu al ,

produce o f the land and labour o f the c ountry I have en ,

d eav o u ed to sh o w in the fourth book o f this Inquiry

r It s eem s .

n o t to have been more favourable to the revenue of the sove

reign so far at least as that revenue depends upon the duties

,

of ustoms
c .

In consequen e f that system the importation of several

c o ,

sorts o f goods has been prohibited altogether This prohibition

has in some cases entirely prevented and in others has very ,

much diminished the importation of those commodities by

reducing the importers to the necessity o f smuggling It ha s .

entirely prevented the importation o f foreign woollens and it ,

has very much diminished that o f foreign silks and velvets In .

both cas es it has entirely annihilated the revenue f customs o

whi c h might have been levied upon such importation .

The high duties whi h have been imposed upon the importa
c

tion of many different sorts o f foreign goods in order to dis ,

courage their consumption i Great Britain have in many case s n ,

se rved only to encourage smuggling and in all ases have ,

c

reduced the revenue f the ustoms below what more moderate

o c

duties would have afforded The saying of Dr Swift that in . .

,

the arithmetic o f the customs two and two instead of making ,

four make sometimes only one holds perfe tly true with regard
, ,
c

to such heavy duties whi h never could have been impose d c

ha d not the mercantile system taught us in many cases t o , ,

employ taxation as an instrument not of revenue but o f , ,

monopoly .

The bounties which are sometimes given upon the e xporta

 Th e S o u r c es of R e v en u e 6
3 3
tion of home produce and manufactures and the drawbacks ,

which are paid upon the e exportation o f the greater part f r o

foreign goods have given oc as on to many frauds and to a

,
c i ,

species of smuggling more destru tive o f the public revenu e c

than any other In order to obtain the bounty or drawba k

. c ,

the goods it is well known are sometimes shipped and sent t

, ,
o

sea but soon afterwards clandestinely relanded in some othe

,
r

part o f the country The defalca tion o f the revenue f ustom s

. o c

occasioned by bounties and drawbac ks o f which a great part ,

are obtain ed fraudulently is very great The gross produce o f

,
.

the customs in the year which ended o the st h o f January 75 5 n 1

amounted to The bounties which were paid o u t o f

this revenue though in that year there was no bounty upon
,

corn amounted to
,
The drawbacks which were paid
upon debentures and certificates to Bounties a d ,
n

drawbacks together amounted to In consequenc e

o f these deductions the revenue o f the customs amounted onl y
to £ 74 34
2, from which deducting
,
oo f the expense,
or

o f management in salaries and other in cidents the net revenu e ,

o f the ustoms fo that year comes out to be

c r 5 00 The .

expense o f management amounts in this manner to between fiv e

and six per cent upon the gross revenue of the customs and t o
.
,

something more than ten per cent upon what remains o f that .

revenue after deducting what is paid away in bounties a d n

drawba ks c .

Heavy duties being imposed upon almost all goods imported ,

o ur merchant importers smuggle as much and make entry o f

as little as they can Ou mer hant exporters on the contrary

. r c , ,

make entry o f more than they export ; sometimes o u t f vanity o ,

and to pass f r great dealers in goods which pay no duty and

o ,

sometimes to gain a bounty or a drawba k Ou exports in c . r ,

consequen e of these different frauds appear upon the ustom

c ,
c

house books greatly to overbalanc e o u imports to the u r ,

n

speakable omfort f those politi ians who measure the national

c o c

prosperity by what they all the balan e f trade c c o .

All goods imported unless parti ularly exempted a d suc h

,
c ,
n

ex emptions are not very numerous are liable to so me duties f ,

o

customs If any goods are imported not mentioned in the book

.

o f rates they are taxed at 4 3 —d for every twenty shilling s

, 9 0 .
2 o .

value accordi g to the oath f the importer that s nearly at

,
n o ,
i ,

five subsidies five poundage duties The book f rates is

,
or . o

extremely comprehensive and enumerates a great variety o f ,

artic les many o f them little used and therefore not well known
, ,
.
 6
3 4 Th e W eal t h of N a t i o n s
It is upon this account frequently uncertain under what arti cl e
a particular sort o f goods ought to be classed and consequent l y ,

what duty they ought to pay Mistakes with regard to this .

sometimes ru in the custom house officer and frequently occasion -

much trouble expense and vexation to the importer In point

, ,
.

o f perspicuity precision and distinctness therefore the duties

, , , ,

o f customs are much inferior to those of excise .

In order that the greater part o f the members of any society

should contribute to the public revenue in proportion to their
respective expense it does o t seem necessary that every single
,
n

article o f that expense S hould be taxed The revenue which .

is levied by the duties o f excise is supposed to fa ll as equally

upon the contributors as that which is levied by the duties o f
customs and the duties o f excise are imposed upon a few
,

articles only f the mo st ge eral use and consumption It has

o
‘

n .

been the opinion f many people that by proper management

o , ,

t he duties of customs might likewise without any loss t o the ,

public revenue and with great advantage to foreig n trade be

, ,

c onfined to a few articles only .

The foreign articles o f the most general use and consumption

in Great Britain seem at present to consist chiefly in foreign
wines and brandies in some of the productions o f America and
the West Indies—sugar rum toba co cocoanuts etc ; and in c
—
.
, , , ,

s ome o f those o f the East Indies tea coffee hina ware spicerie s , ,
c -

o f all kinds several sorts f pie c e goods etc These different

,
o -

,
.

a rticles aff ord perhaps at present the greater part o f the

, , ,

revenue which is drawn from the duties of customs The taxes .

which at present subsist upon foreign manufactures if you ,

e x ept those upon the few contained in the foregoing enumera

c

tion have the greater part f them been imposed for the purpose
,
o ,

n o t o f revenue but o f monopoly ,

to give our own merchants ,
or

a n advantage in the home market By removing all pro .

hi bitio and by subjecting all foreign manufactures to such

n s,

moderate taxes as it was found from experience afforded upon

e ach arti le the greatest revenue to the public our o w work
c ,
n

men might still have a considerable advantage in the home

market and many articles some o f which at present afford n o
, ,

revenue to government and others a very inconsiderable one , ,

might afford a very great o e n .

High ta xes sometimes by diminishing the consumption of

,

the taxed commodities and sometimes by encourag ing smuggling

, ,

frequently afford a smaller revenue to government than what

might be drawn from more mo d erate taxes .
 Th e S o u r c e s of R ev en u e 6
3 5
When the diminution o f revenue is the e ffect o f the dimin u
tion o f consumption there can be but o n e remedy and that is ,

t he lowering o f the tax .

Wh en the diminution o f the revenue is the effect o f t he

encouragement given to smuggling it may pe rhaps be remedied ,

in t w o ways ; either by dimin ishing the temptation to smuggle ,

o r by i ncreas ing the difficu lt y of smuggling The tempta tion .

to smuggle c be diminished only by the lowering of the tax

an ,

and the d iflic ult y o f smuggling can be increas ed only by estab

lishing that system of adminis t ration w hi ch is most prope r for
preventin g it .

The excise laws it appears I believe from ex p erience

, , , ,

obstruct and embarras s the operations o f the smuggler much

more e ffectually than those of the customs By introducing .

into the customs a system of admi istration as sim ilar to that n

o f the excise as the nature o f the diff erent duties will a d mit ,

the difficul t y f smuggling might be very much in reased This

o c .

alt eration it has been supposed by many people might very

, ,

easily be brought abo ut .

The importer o f commodities liable to any duties o f ustoms c ,

it has been said might at his Option be allowed either to carry

,

t hem to hi s own private warehouse or to lodge them in a ware ,

house provided either a t his o w expense o r at that of t he n

public but under the key of the custom house o fficer and never
,
-

to be Opened but in his presence If the merchant carried them .

t o his w
o private warehouse the duties t o be immediately paid
n , ,

and never afterwards to be drawn ba k and that warehouse c ,

to be at all times subject to the visit and examination f t he o

custom house officer in order to ascertain h w far the quantity

-

,
o

contained in it orresponded with that fo whi c h the duty had

c r

been paid If he carried them to the public warehouse no duty

.
,

to b e paid till they were taken out for home consumption I f .

taken o ut for exportation to be du t y free proper se uri t y being

, ,
c

always given that they should be so exported The de al e rs in .

those particular commodities either by wholesale or reta il t o, ,

be at all times subject to the visit and examination o f the

custom house officer and to be obliged to justify by proper
-

certificates the payment o f the du t y upon the whole quan tity

contained in their shops or warehouses What are called the .

excise duties upon rum imported are at present levied i this

-
n

m anner and the ame system o f administration might perhaps

,
s

be ext ended t o all duties upo n goods import ed provided always ,

that t hose duties were l ike the duties o f excise confined to a

, ,
 66 The W eal t h of N a t i o n s
”

3
f ew
-

sorts of goods o f the mo t g e al use a d consumption s

'

en r n .

If they were extended to almost all sorts of goods as at present , ,

p ubli warehouses
c f su f
f icient extent could not
o easily be
p rovided and goods of
,
a very delicate nature or of whi h the ,
c

p reservation required mu h are and attention ould not safely

c c ,
c

b e trusted by the mer hant in any warehouse but his own c .

If by su h a system of administration smuggling to any

c ,
con

si d b l extent
era e ould be prevented even under pretty high
,
c

duties and if every duty was occasionally either heightened

,

o lowered a cording as it was most likely either the e w y

r c , on a

o r the other to afford the greatest revenue to the state taxa

, ,

t ion being always employed as an i nstrument of revenue and

n ever of monopoly it seems not improbable that a revenue ,

a t least equal to the present net revenue of the customs might

be drawn from duties upo n the importation of only a few sorts

o f goods of the most general use and consumption and that the ,

d uties of customs m ight thus be brought to the same degree

o f simpli c ity certainty and precision as those of ex ise
,
What
,
c .

t he revenue at present loses by drawbacks upon the exporta re

-

t ion o f foreign goods whi h are afterwards relanded and c o c n

S umed at home would under this system be saved al together .

I f to this saving which would alone be very onsiderable were

,
c ,

a dded the abolition of all bounties upon the exportation f o

h ome produce in all cases in whi c h those bounties were not

i reality drawbacks o f some duties of ex ise which had before
n c

b een advanced it cannot well be doubted but that the net

,

r evenue o f customs might after an alteration o f this kind be , ,

fully equal to what it had ever been before .

If by such a change f system the public revenue suffered no o

l oss the trade and manufa tures f the country would certainly
,
c o .

g ain a very considerable advantage The trade in the com .

m odi f ies not taxed by far the greatest nu mber would b e , ,

'

p erfectly free and might be carried

,
o n to an d from all parts

o f the world with every possible advantage Among those .

c ommodities would be comprehended all the necessaries o f life

an d all the materials of m anufa ture So far as the free im c .

p t
or a t i f the necessaries
on o o f life reduced their average money

p rice in the home market it would reduce the money price f o

labour but without reducing in any respect its real recompense

,
.

The value o f money is in proportion to the quantity of the

n e essaries of life which it will purchase That of the ne c essaries
c .

o f life 3 altogether independent o f the quantity o f m oney which

1

c a be had fo r them The reduction in the money price o f

n .
 T h e S o u r c e s of R ev e n ue 6
3 7
labour woul d ne essaril y be attended with a proportionable
c

one in that o f all home manufactures which would thereby gain ,

some advanta ge in all foreign markets The price of som e .

man ufactures would be reduced in a still greater proportion by

the free importation o f the raw materials If raw silk could .

be imported from China and Indosta n duty free the il k manu ,

S

f c t u e s in England could greatly undersell those of both

a r r

France and Italy There would be no oc asion to prohibit the

. c

imp ortation f foreign silks and velvets The h eapness o f their

o . c

goods would secure to o u o w workmen not only the posses r n

sion f the home but a very great comm and of the foreign
o

market Even t li
,

. e trade in the commodities taxed would be

ca ried on with much more advantage than at present If those

r .

commodities were delivered o ut of the publi warehouse fo c r

foreign exportation being in this ca se exempted from all ta xes, ,

the trade in them would be perfe tly free The ca rrying trade c .

in all sorts o f goods would under this system enjoy every possible
advantage If those commodities were delivered u t for home
. o

consumption the importer not b eing obl iged to advance the

,

tax till he had an Opportuni t y o f selling his goods either t some ,

o

dealer o to some consumer he could always afford to sell them

,
r ,

cheaper than if he had been obliged to advance it at the moment

o f importation Under the s ame taxes the foreign trade f
.
,
o

con umption even in the tax ed ommodities might in this

s c

manner be carried with much more advanta ge than it can on

at present .

It w as the object of the famous excise scheme f Sir Robert o

Walpole to esta blish with regard to wine and tobacco a system , ,

not very unlike that whi h is here proposed But though the c .

bill which was then brought into parliament comprehended

those t wo commodities only it w as generally supposed to be ,

meant as an introduction to a more extensive scheme of the

same kind faction combined w ith the interest o f smuggling
, ,

merchants raised so violent though so unjust a clamour against

, , ,

that bill that the minister thought proper to drop it and from
, ,

a dread f exciting a clamour f the same kind none of his

o o ,

su essors have dared to resume the project

cc .

The duties upon foreign luxuries imported for home con

sumption though they sometimes fall upon the poor fall
, ,

principally u p on people f middli g o more than middling o n r

fortune Such are for example the duties upon foreign Wines
.
, , ,

upon coffee cho colate tea sugar et c

The duti
, , , ,
.

es upon the cheaper l uxuries o f home pro d uce

368 Th e W e al t h of N at i o n s
destined fo r home consumption fall pretty equally upon peopl e
o f all ranks in proport ion to their respe c tive expense The poor .

pay the duties upon malt hops beer and ale upon t heir o wn , , , ,

consumption the rich upon both their w consumption an d

.
,
o n

that o f their servants .

The whole consumption of the inferior ranks o f people o o f ,

r

those below the middling rank it must be observed is in every , ,

country much greater not onl y i quantity but value than

,
n ,
111 ,

that of the middling and o f those above the middling rank .

The Whole expense of the inferior is much greater than that of

the superior ranks In the first place al most the whole apital
.
,
c

o f every country is annually distributed among the inferio r

ranks of people as the wages of productive labour Second l y .

,

a great part of the revenue arising from both the rent of land
and the profits o f stock is annually distributed among the same
rank i the wages and maintenance o f menial servants and other
n ,

unproductive labourers Thirdly some part f the profits of

.
,
o

stock belongs to the same rank as a revenue arising from the

employment of their small apitals The amount of the profits c .

annually made by small shopkeepers tradesmen and reta ilers , ,

of all kinds is everywhere very onsiderable and makes a very c ,

considerable portion of the annual produ e Fo u t hly and c . r ,

l astly some part even of the rent o f land belongs to the same
,

rank a onsiderable part to those who are somewhat below

,
c
“

the middling rank and a small part even to the lowest rank
, ,

common labourers sometimes possessing in property an acre o r

t w o of land Though the expense of those inferior ranks o f

.

people therefore taking them individually is very small yet

, , , ,

the Whole mass of it taki g them collectively amounts always

,
n ,

to by much the largest portion of the Whole expense of the

society ; what remains f the annual produce o f the land and
o

l abour o f the country fo r the consumption o f the superior ranks

being always much less not only in quantity but in value The
, ,
.

taxes upon expense therefore which fall hiefly upon that

, ,
c

o f the superior ranks o f people upon the smaller portion o f the ,

annual produ c e are likely to be much less productive than

,

either those which fall indi ff erently upon the expense o f al l

ranks o even those which fall hiefly upon that o f the inferior
,
r c

ranks ; than either those which fall indi fferently upon the whole
annual produce or those whi h fall chiefly upon the larger
,
c

portion Of it The excise upon the materials and manufacture

.

o f home made fermented a nd spirituous liquors i accordingly s ,

o f al l the di ff erent taxes upon expense by far the most pro ,

 The So u r c es of R e v en u e .
3
6
3 9
-

d uc t i
ve and this bran ch o f the excise falls very much perhaps ,

principally upon the expens e f the common people In the

,
o .

year which ended on the 5 t h o f July 775 the gross produce o f 1 ,

this bran ch o f the exc ise amounted to 9 9d 5 . .

It must always be remembered however that it is the , ,

l uxurious an d not the necessary exp ense o f t he in ferior rank s

o f pe ople that ought ever to be taxed The final payment o f .

an y t ax upon their neces sary ex p ense would fall alto ether

g
upon the superior ranks of peopl e ; upon the smaller porti o n o f
the annual produce and not upon the greater Such a t a x
,
.

must in all cases either raise the wages o f labour o r lessen the ,

demand for it It coul d not raise the wages o f labour without

.

t hrowin g the final payment o f the tax upon the superior r a nks
o f people It could not lessen the dema d for labour without
. n

lessenin g the annual produ e o f the land and labour o f the c

country the fund from which all taxes must be finally paid
,
.

Whatever might be the sta te to which a tax o f this kind reduced

the deman d fo labour it must always raise wages higher th an
r , 0
they otherwise would be i that state and the fin al payment n ,

o f thi s enhancement o f wages must in all cases fall upon the

superior ranks o f people .

Fermented li quors brewed and spirituous liquors distilled , ,

not fo r sale but fo private use are not in Great Britain liable
,
r ,

t o any duties of exc i se This exemption of which the Object.

,

is t o save private families from the odious visit and examination

o f the tax gatherer o cas ions the burden of those duties to fall
-

,
c

frequently much lighter upon the ri h than u p on the poor It c .

i s not indeed very common to disti

, ,
l for private use though it ,

is done sometimes But in the country many middling an d

.

almost all rich and great families brew their o w beer Their n .

strong beer therefore costs them eight shillings a barrel les s

, ,

than it costs the common brewer who must have his profit ,

u po n the tax as well as upon all the other expense which he

a dvances Such families therefore must drink their beer at
.
, ,

least nine o ten shillings a barrel cheaper than any liquor o f

r

the sa me quality can be drunk by the common people to whom ,

it is everyw here more convenient to buy their beer by littl e ,

and little from the brewery o r the alehouse M alt in the sa me

,
.
,

manner that is made fo r the use f a private family is o t

, o n

liable to the v isit o examin ation o f the tax gatherer ; but in

r -

this case the family must compo und at seven shillings and
p nce a hea d fo r the t ax Seven shill ings and S ixp ence are
e .
37 0 The
W eal t h of N at i o n s
e qual t o the excise upon ten bushels f mal t— quantity fully
o a

equal t o What all the different members of any sober family ,

men women and hildren are at an average likely to consume

, ,
c , .

But in rich and great families where country hospitality is ,

much practised the malt liquors consumed by the members o f

,

the family make but a small part of the consumption of the

house Either o account o f this composition however o r fo r
. n , ,

o t her reasons it is not near so common to malt as to brew for

,

private use It is difficult to imagine any equitable reason Why

.

those who either brew o distil for private use should not be r

subject to a composition of the same kind .

A greater revenue than what is at present drawn from all

t he heavy taxes upon malt beer and ale might be raised i t , , ,

has frequently been said by a much lighter tax upon malt the, ,

Opportunities o f defrauding the revenue being much greater in

a brewery than in a malt house and those w ho brew fo r private -

use bein g exempted from all duti es o composition fo duties r r ,

which is not the case with those who malt for private use .

In the porter brewery o f London a quarter of malt is -

commonly brewed nto more than t w o barrels and a half some

i ,

times into three barrels o f porter The different taxes upon .

malt amount to six shillings a quarter those upon strong beer ,

and ale to eight shillings a barrel In the porter brewery there .

,

fore the different t axes upon malt beer and ale amount to
, , ,

between twenty six and thirty shillings upon the produ c e o f a

-

quarter f malt In the country brewery fo common country

o . r

sale a quarter o f malt is seldom brewed into less than two

barrels of strong and o e barrel f small beer frequently into
n o ,

two barrels and a half of strong beer The different taxes upon .

small beer amount to one shilling and fourpence a barrel In .

the country brewery therefore the different taxes upon malt

, , ,

beer and ale seldom amount to less than twenty three shillings
,
-

and fourpence frequently to twenty six shillings upon the

,
-

produce of a quarter f malt Taking the whole kingdom at an

o .

average therefore the whole amount o f the duties upon malt

, , ,

beer and ale cannot be estimated at less than twenty four or

,
-

twenty fi e S hillings upon the produce o f a quarter o f malt

-

v .

But by taking o ff all the different duties upon beer and ale and ,

by tripling the m alt tax o by raising it from six to eighteen ,

r

shillings upon the quarter o f malt a greater revenue it is said , , ,

might be raised by this single tax than what is at prese nt

drawn from all those heavier taxes .
 Th e S o u r c e s of R ev e n u e 37 1

the malt t a x produced

o ld -

The additional
the ld tax produc ed
O

The additional
the old tax produced
The additional
the o ld t ax produced
The additional

A verage of these four years 3

3
01 7

1 the country excise produ ed

772 , c

The London brewery

1 773 the ,
country excise
The London brewery
1 774 t he country excise
,

The London brewery

1 7 5
7 the ,
country excise
The London brewery
I 9 Z
f
verage of these four years
A 4 93
To whi h adding the average malt tax
c -

,
or 3 0135

The Whole amount of those different taxes

comes out to be —
7 911
,

But by tripling the malt tax or by raising

’

it from six to eighteen shillings upon the

quarter of malt that single tax would
,

produce 9
—
9
01 3
A sum Whi h exceeds the foregoing by
c - 1 2 1 1
?

Under the o ld malt tax indeed is omprehend ed a tax o f

-

, ,
c

four shillings upon the hogshead of cyder and another of ten ,

shillings upon the barrel of mum In 774 the tax upon cyde . 1 ,
r

produ ed only £3083 6s 8 d It probably fell somewhat short

c . .

o f its usual amount all the different ta xes upon cyder having
, ,

that year produced less than ordinary The tax upon mum
, .
,
 The W eal t h o f N at i o ns
though much heavier is still less productive on account o f the , ,

smaller onsu mption o f that liquor But to balance Whatever

c .

m ay be the ordinary amount o f those two taxes there is com ,

p rehended under what i s called the country excise first the Old , ,

ex ise o f six shillings and eightpen e upon the hogshead o f

c c

cyder ; secondly a like tax o f ix shillin gs and eightpence upon

,
S

the hogshead f verjuice thirdly another o f eight shillin gs and

o ,

ninepence upon the hogshead of vin egar ; and lastly a fourth , ,

tax o f ele e p e c e upon the gallon o f mead o r methegl in the

v n n :

produce of those different taxes will probably much more than

counterbalance that o f the duties imposed by what is called
the annual malt tax upon c yder and mum .

M alt is onsumed not only in the brewery o f beer and ale but
c ,

in the manufacture o f lo w W ines and S pirits If the malt tax .

were t o be raised to eight een shillings upon the quarter it might ,

be necessary to make some abatement in the different excises

.

w hich are i mposed upon those particular sorts of low wines and
spirits o f which malt makes any part o f the materials In what .

a re called malt spirits it makes commonly but a third part o f

the materials the other t w o thirds bein g either raw barl ey o r
,
-

o n e third barley and o n e third wheat

-
In the distillery of malt -

s pirits both the Opportunity and the temptation t o smuggle

,

a e much gr eater than either in a brewery o r in a malt house ;

r -

t he opportunity on account o f the smaller bulk and greater

value o f the ommodity and the temptation o account of
c ,
n

the superior height o f the duties which amount to 35 §d ,

. I o .
1

upon the gallon of spirits By increasing the duties upon malt .

,

a n d reducing those upon the distillery both the opportunities ,

an d the temptation to smuggle would be diminished which ,

might occasion a still further augmentation o f revenue .

It has for some time past been the policy o f Great Britain to
d iscourage the c onsumption o f spirituous liquors n account o f ,
o

their supposed tendency to ruin the health and to corrupt the

m orals o f the common people A ccordin g to this policy the .
,

a batement o f the taxes upon the distil lery ought not to be o s

great as t o reduce in any respect the price f those liquors , ,

o .

Spirituous liquors might remain as dear as ever while at the ,

same time the wholesome and invigorating liquors o f beer an d

a le might be considerably reduced in their price The people .

Th
1
gh t h d t i di t ly imp d p p f pi i t m t ly t
ou e u es r ec o se u on ro o s r s a o un on o
25 6d p g ll t h dd d t t h d t i p t h l w w i
er a on, ese a f m e o e u es u on e o n es , ro
whi h t h y dit ill d m t t 3 id B t h l w w i d p f
. .

c e ar e s e a o un o 5 ro o o n es a n ro o
f it t p v t f d t d di g t w h t t h y g g i
. .
,

5 r s ar e, wo re en r au s, n o ra e ac c o r n o a e au e n
t e w as h .
 Th e So u r c e s of R ev e n u e 37 3
might thus be in part relieved from one o f the burdens Of which
they at present complain the most while at the same time t he ,

revenue might be considerably augmented .

The Objections o f Dr Davenan t to this alteration in t he

,
.

present system o f excise duties seem to be without foundation .

Those obje tions are that the tax instead o f dividing itself as
c , ,

at present pretty equally upon the profit o f the maltster upo ,

n

that o f the brewer an d upon that o f the retailer would so fa

, , ,
r

as it affec t ed profit fal l al together upon that of the m altster ;

,

that the maltster could not so easily get back the amount o f
the tax i n the advanced price o f his malt as the brewer a d n

retailer in the advanced price of their l iquor ; and that so heavy

a tax upon malt might reduce the rent and profit o f barley land .

N o tax can ever reduce fo any considerable time the rate ,

r ,

of profit in an y particular trade which must always keep it s

level with other trades in the neighbourhood The presen t .

duties upon malt beer and ale do not affe t the profits o f t he
, ,
c

dealers in those ommodities who all get back the tax with an
c ,

additional profit in the enhan ed price f their goods A tax c o .

,

indeed may render the goods upon which it is imposed so dear

,

as to diminish the onsumption of them But the consumption

c .

o f malt is in malt liquors and a tax of eighteen shillings upori ,

the quarter o f malt could not well render those liquors dearer
than the different ta xes amounting to twenty four or twenty ,
-

five shill ings do at present Those liquors on the ontrary

,
.
,
c ,

would probably become cheaper and the c onsumption of them ,

would be more likely to increase than to diminish .

It is not very easy to understand why it should be more

diffi ult for the maltster to get ba k eighteen s hillings in t he
c c

advanced pri e of his malt than it is at present for the brewe

c r

to get back twenty four r twenty fiv e sometimes thi ty shilli gs

-
o -

,
r ,
n

in that o f his liquor The maltster indeed instead f a tax f

.
, ,
o o

six shillings would be obliged t advance one of eighteen shillings

,
o

upon every quarter of malt But the brewer is at present .

obliged to advan e a tax f twenty four or twenty fi some

c o - -

v e,

times thirty shillings upon every quarter of malt whi h h

,
c e

brews It ould not be more inconvenient for the maltster t o

. c

advance a lighter tax than it is at present for the brewer t o

advan e a heavier one The maltster doth not always keep in
c .

his granaries a sto k of malt which it will require a longer time

c

to dispose of than the stock of beer and ale whi h the brewe c r

frequently keeps in his cellars The former therefore may .

, ,

frequently get the returns o f his money as soon as the latter .

37 4 T he W e al t h of N at i o n s
B ut whatever i nconveniency might arise to the maltster from
ei g obliged to advan e a heavier tax it ould easily be
b n c ,
c

r emedied by granting him a few months longer credit than is ’

a t present ommonly given to the brewer

c .

N othing could reduce the rent and profit f barley land which o

di d not reduce the demand for barley But a hange o f system . c

w hich reduced the duties upon a quarter of malt brewed into

‘

beer and ale from twenty four and twenty fiv e shillings to - -

e ighteen shillings would be more likely to increa se than diminish

that demand The rent and profit o f barley land besides must
.
, ,

a lways be nearly equal to those o f other equally fertile and

e qually well cultivated land -

If they were less some part of .

,

the barley land would soon be turned to some other purpose ;

a d if they were greater more land would soon be turned to
n ,

the raising of barley When the ordinary price f any parti . o

c ula produce o f land is at What may be alled a monopoly

r c

price a tax upon it ne essarily reduces the rent and profit o f

,
c

the land which grows it A tax upon t he p o duc e o f those .

'
r

pre ious vineyards f which the wine falls so mu h short o f the

c o c

effe tual de mand that its pri e is always above the natural
c c

p roportion to that o f the produce of other equally fertil e and -

equally well c ultivated land would ne essarily redu c e the rent

-

and profit f those vineyards The pri e f the wines being

o . c o

a lready the highest that ould be got for the quantity com m only c

s ent to market it ould not be raised higher without diminish

,
c

i g that quantity and the quantity could not be diminished

n ,

W ithout still greater loss be c ause the lands could not be turned ,

t o any other equally valuable produce The whole W eight of .

t he tax therefore would fall upon the rent and p fit — properly

, ,
ro

upon the rent f the vineyard When it has been proposed to

o .

lay any new tax upon sugar our sugar planters have frequently ,

c omplained that the whole weight f such taxes fell o t upon o ,

n

t h consumer but upon the producer they never having been

e , ,

able to raise the price o f their sugar after the tax higher than
it was before The pri c e had it see ms before the tax been a
.
, ,

monopoly price and the argument addu c ed to S how that sugar

,

was an improper subject f taxation de monstrated perhaps o , ,

that it w a a proper one the gains f monopolists whenever

s ,
o ,

they can be come at being ertainly f all subje c ts the most ,

c o

proper But the ordinary price f barley has never been a

. o

monopoly price and the rent and profit f barley land have
,
o

n ever been bove their natural proportion to those o f other

a

e qually fertile and equally well cultivated land The different -

.
 Th e S o u r c e s:of R e v en u e 37 5
t axes which have been impo sed upon mal t beer and ale have , ,

n ever l owered the price of barley have never reduced the rent ,

an d profit o f barley land Th e price of ma lt to the brewer has

.

c onstantly risen in p r oportion to the taxes imposed upon it ,

an d those taxes together with the different duti es upon beer

,

an d ale have constantly either raised the pri e or W hat com es

,
c ,

to the same thing redu ed the quality o f those commoditi es

,
c

to the consumer The final payment f those taxes has fallen

. o

c onstantly upon the consumer and n o t upon the producer

The only people likely to suffer by the change o f system here
,
.

proposed are those wh brew for the ir o wn private use But o .

the exemption whi h this superior rank o f people at present

c

e njoy from very heavy taxes which are paid by the poor
labourer d an fi e is surely most unjust and unequal and
ti ar c r ,

o ug ht t o be taken away even though this chan ge was never to ,

take pla e It has probably been the interest f this superior

c . o

o rder of people however Which has hitherto prevented a change

, ,

o f system that could t well fail both to increase the revenue

no

a d to relieve the peop le

n .

Besides such duties as those o f customs and excise above

mentioned there are several others whi h affect the pri e o f
,
c c

goods more unequally and more indirectly Of this kind are .

the duties whi h in Fren h are called P é ages which in old Saxon
c c ,

times were alled Duties f Passage and whi h seem to have

c o ,
c

been originally established f the same purpose as u tu npike or o r r

tolls o the tolls upon u anals and navigable rivers for the
,
r o r c
,

m aintenan c e f the road or o f the navigation

o Those duties .
,

when applied to su h purposes are m ost properly imposed

c ,

ccording to the bulk or weight f the goods A S they were

a o .

originally local and provin c ial duties appli able t o lo al and ,

c c

provincial purposes the administration of them was in most

,

cases entrusted to the particular town parish lordship in , ,

or

which they were levied such communities being in some w ay ,

o other supposed to be accountable for the application The

r .

overeign who is altogether unaccountable has in many

s , ,

c ountries assumed to himself the administration o f those duties

,

a d though he has
n most cases enhan c ed ve y much the duty
111 r
,

he has i many entirely negle ted the appli ation If the turn
n c c .

p ike t llS of Great Britain hould ever be ome

o f the S c one o re
our es f government w may learn by the example o f many
s c o ,
e ,

other nations what would probably be the consequence Su h

, . c
tolls are no doubt finally paid by the consu mer ; but the con
s ume r i s no t t axed in proporti o n t o his expense when he pays
,
37 6 Th e '

W e alt h of N at i o n s
no t according t o the value but according to t he bulk or weight
,

of what he consumes When su h duties are imposed not . c ,

ac ording to the bulk o r weight but according to the supposed

c ,

value o f the goods they become properly a sort f inl an d

, o

customs o excises which obstruct very much the most im

r

portant of al l branches o f commerce the interior commerce o f ,

the country .
I

In some smal l states duties similar to those passage duties

are imposed upon goods carrie d across the territory either by ,

l and o by water from o e foreign country to another These

r ,
n .

are in s ome countries called transit duties Some of the little -

.

Ita lian states which are situated upon the P o and the rivers
which run into it derive S ome revenue from duties o f this kin d
which are paid altogether by foreigners and which perhaps are ~
, , ,

the only duties that o n e state can impose upon the subjects of
another without obstructin g i n any respect the industry o r
commerce of its own The most important transit d uty in t he
.
-

world is that levied by the King of Denmark upon al l merchant

ships which pass through the Sound .

Such taxes upon luxuries as the greater part o f the duties of

customs and exc i se though they all fall indifferentl y upon every
,

diff erent species o f revenue and are paid final l y or without any
, ,

retribution by whoever consumes the commodities upon wh i ch

,

they are imposed yet they do not always fall equally o pro
,
r

p t
or i
o a bnly upon the revenue of every individual As every .

man s humour regulates the degree o f his consumption every

’
,

man contributes rather according to his humour than in pro

portion t o his revenue ; the profuse contribute more the parsi ,

m i on o u less than their proper proportion

s ,
During the min ority .

of a man o f great fortune he contributes commonly very little ,

by his consumption towards the support f that state from

,
o

whose protection he derives a great revenue Those who live .

in another country contribute nothing by their consumption , ,

towards the support o f the government of that country in

which is situated the source o f their revenue If in this latte . r

c ountry there should be no land tax nor any considerable duty -

upon the transference either o f movable or f im movable pro o

perty as is the case in Ireland su h absentees may derive a

.

,
c
,

great revenue from the protectio n of a government to the

support f which they do not contribute a ngle sh ll ng , This
o Si i i

inequality is likely to be greatest i a country o f wh ich the n

government is in some respects subord inate and dependent u pon

.

that f some other The people who possess the most ext en swe
o .
 Th e S o u r c e s of R e v en u e 37 7
p roperty in the dependent will i this cas e generally hoose t o n c

five in the governing co untry Ireland is precisely in this .

s itua tion and we cannot therefore wonder that the proposal o f

, , ,

a tax upon absentees should be so very pop ular in that country .

It might perhaps be a little d ifli ult to ascertain either what

, ,
c

s ort what degree f absen e would subject a man to be taxed

or o c

as an absentee or at what pre ise time the tax hould either

,
c S

begin o end If you ex ept however this very peculiar S itua

r . c , ,

tion any inequality in the ontribution f individuals which

,
c o

c an arise from such ta xes is much more than ompensated by

t he very circums tan e whi h occa ions that inequality —the
c

c c s

C ir umstan ce that every man s contribution is altogether vol

c
’

tary it being al together in his power either to consume or not

,

t onsume the comm odity taxed Where su h ta xes therefore

o c . c , ,

are properly assessed and upon proper commodities they are , ,

paid wi t h less grumbling than any other When they are .

advanced by the merchant or manufa turer the consumer who c , ,

finally pays t hem soon comes to co f ound them with t he price

,
n

o f the o mmodities and almost forgets that he pays any tax

c , .

Such taxes are or may be perfectly ertain or may be assessed c ,

so as to leave no doubt con c ern ing either what ought to be paid ,

o rwhen it ought to be paid ; on erning e ither the quantity r c c o

the time f payment Whatever un cer t aint y there may some

o .

times b e either in the duties of customs in Great Britain or in

, ,

o ther duties of the same kind in other countries it cannot aris e ,

from the nature o f those duties but from the inaccura t e or ,

unskilful manner in whi h the law that imposes them is c

e xpressed .

Taxes upon luxuries generally are and always may be paid , ,

pie emeal or in proport on as the cont ributors have oc a ion

c ,
i c s

t opur hase the goods upon whi c h they are imposed In the
c .

time and m ode o f payment they are or may be f all taxes the , ,
o

m ost onve ient c Upon the whole su h taxes therefore are

n .
,
c ,

p erhaps as agreeable to the th ee first o f the four general

, ,

,
r

maxims on erni g taxation as any other They fi d in

c c n . o en

e very respe c t against the fourth .

Such taxes in proportion to What they bring into the pub lic
,

treasury f the state always take out or keep out f the pockets
o ,
o

o f the people m ore than almost any other taxes They seem .

to do this in all the four d ifferent ways in whi h it is possible c

t odo it .

Fir st the levying f su h taxes even when imposed in the

, o c ,

m ost judi ious manner r qui res a great numbe r o f custom

c
,
e

N
37 8 Th e We l t h a of N a t i o n s
house and excise o fficers whose salaries and perquisites are a ,

real tax upon the people whic h brings nothing into the treasury ,

o f the state This expense however it must be ackn owledged

.
, , ,

is more moderate in Great Britain than in most other countries .

In the year which ended o the st h o f July 775 the gross n 1 ,

produce of the different duties under the management of the ,

commissioners f excise in England amounted t oo ,

1 8 5 S ad
. whic h wa levied at an expense o f little more than fiv e
l
-

,
s

and a half per cent From this gross produce however there .
, ,

must be deducted what w as paid away in bounties and draw

backs upon the exportation o f excisable goods which will reduce ,

the et produce below five millions The levying o f the sal t

n .
1

duty an excise duty but under a different management is much

, , ,

more expensive The net revenue of the customs does no t

.

amount to t w millions and a half whi h I s levied at an expens e

o ,
c

o f more than ten per cent in the salaries o f o fii and othe r ‘

. c ers ,

incidents But the perquisites o f custom house o fficers are every

.
-

w here much greater than their salaries ; at some ports more

than double o triple those salaries If the salaries o f officers
r .
,

and other incidents therefore amount to more than ten p e , ,

r

cent upon the net revenue o f the customs the whole expens e
.
,

o f levying that revenue may amount in salaries and perquisite ,

s

together to more than twenty or thirty per cent The officer

,
. s

o f exc ise receive few or no perquis tes and the administration i ,

o f that branch o f the revenue being o f more recent establis h

»

ment is in general less corrupted than that o f the customs into

, ,

which length o f time has introduced and authorised many

abuses By hargi g upon malt the whole revenue whi h is at
. c n c

present levied by the differ nt duties upon malt and malt liquors e ,

a sav mg it is supposed o f more than fifty thousand pounds

, ,

might be made in the annual expense o f the excise By con .

finin g the duties o f ustoms to a few sorts o f goods and by c ,

levying those duties according to the excise laws a mu c h greater ,

sav ing might probably be made in the annual expense o f t he

customs .

Secondly su h taxes necessarily occasion some obstruction

,
c

o r discouragement to certain branches of industry As they .

always raise the price o f the commodity taxed they so far dis ,

courage its consumption and consequently its produ tion If ,

c .

i t is a commodity of home growth o manufacture r ,

comes to be employed in raising and producing it .

an oes , a mo un t e dt o 1 9 3. 6d .
 T he S o ur c e s o f R ev e n u e 37 9
foreign commodity o f which the t a x in creases in this manne r
the price the ommodities o f the same kind which are made a t
,
c

home may thereby indeed gain some advantage in the hom e

, ,

market and a greater quantity o f domestic industry may thereby

,

be turned toward preparin g them But though this rise o f .

p ice in a foreign commodity may encourage domestic indus t ry

r

in o ne particular branch it necessarily discourages that industry ,

in almost every other The dearer the Birmingham manu .

facturer buys his foreign wine the cheaper he necessarily sell , s

that part o f his hardware with which o what comes to the sam e ,
r,

thin g with the price o f which he buys it That part of his

,
.

hardware therefore becomes o f l ess value to him an d he has

, , ,

less encouragement to work at it The dearer the onsumers . c

in o e country p ay fo r the surplus produce of another t he

n
,
cheaper they ne c essarily sell that part of their o wn surplu s
produce with which or what comes to the same thing with
, , ,

the price o f which they buy it That part of their own surp l u s .

produce becomes o f less value to them and they have les s ,

encouragement to increase its quantity All taxes upon c o n .

sumable commodities therefore tend to reduce the quanti t y o f

, ,

productive labour below what it otherwise would be either in ,

preparin g the commodities taxed if they are home commodities , ,

o
r in preparing those with which they are purchas ed if the y ,

are foreign commodities Such ta xes too always alter more .

, , ,

or less the natural di rection of national industry and turn

, ,

it into a channel always d ifi re t from and ge nerally les s e n ,

advanta geous than that in which it would have run o f its o wn

accord .

Thirdly the hope o f evadin g such taxes by smuggling give s

,

frequent occasion to forfeitures and other penalties which

entirely ruin the smuggler ; a person w ho though no doub t .
,

highly blamable for violating the laws of his country is f , re

quently in apable of violating those of natural justice and
c
,

would have been in every respect an ex c ellent citizen had o t

, , n
the laws of hi country made that a crime which nature neve
s r
meant to be so In those c orrupted governments where there
.

is at least a general suspicion o f mu h unne essary expense and c c

,

great misappli ation o f the public revenue the laws which guard
c ,

it are little respected N ot many people are scrupulous about

.

smuggling when without perju ry they can find any e asy and
, ,

safe Opportunity of doing so To pretend to have any scruple .

about buyi g smuggled goods though a manifest encourage

n ,

ment to the violation o f the revenue laws and to the perjury ,

 38 0 T he W e al t h ,
of (
N at i o n s
hich almost always attends it would in most countries be
w -

regarded as o e o f those pedantic pieces o f hypocrisy which

n
,

i nstead o f gain in g credit with anybody serve only to expose the ,

person who affe ts t practise them to the suspicion f being a

c o o

g reater knave than most o f his neighbours By t his indulgence .

o f the public the smuggler is often encouraged to continue a

,

trade which he is thus taught to consider as i some mea sure n

i nno ent a n d when the severity o f the revenue laws i ready

c ,
s

t fall upon him he is frequently disposed to defend with

o ,

v iolen c e what he has been a ustomed to regard as his just cc

p roperty From being at first perhaps

. rather imprudent than , ,

c rim in al he at last t o o often becomes one o f the hardiest and

,

m ost determined violators of the laws f society By the ru in o .

f the smuggler his capi tal which had before been em loyed
o ,
p ,

i mai tain i
n ng productive labour is absorbed either in the
n ,

evenue of the state o in that o f the revenue o fficer and is

r r

mployed in maintaining unproductive to the d imin ii

.

e ti of ,
on

t h general capita l o f the so c iety and o f the useful industry

e

w hi h it might otherwise have mainta ined

c .

Fourthly su c h taxes by subjecting at least the dealers in

, ,

t he taxed co mmodities to the frequent visits and odious exam ina

—
tion f the t a x gatherers expose them sometimes no doubt
o , , ,

t o some degree of oppression and always to much trouble and ,

vexation ; and though vexation as has already been said is , ,

o t strictly speaking expense it is certai ly equivalent to the

n , , ,
n

e xpense at whi h every man would be willi g to redeem himself

c n

from it The laws o f excise though more e ffectual for the

.
,

purpose for whi h they were ins ti t uted are in this respect
c , , ,

m ore vexatious than those of the customs When a m erchant .

h imported goods subje t to cer t ain duties o f customs when

as c ,

h e has paid those duties and lodged the goods in his warehouse , ,

he is not in most ases liable to any further trouble vexa c or

t ion from the custom house o fficer It is otherwise with goods -

subje t to duties f excise The dealers have no respite from

c o .

the continual visits and examination o f the ex ise officers The c .

duties f excise are upon this a ount more unpopular than

o ,
cc ,

those f the usto ms ; and so are the o fficers who levy them
o c .

Those officers it is pretended though in general perhaps they

, , , ,

d their duty fully as well as those

o f the customs yet as o , ,

that duty obliges them to be frequently very troublesome to

s ome f their neighbours com monly c ontra c t a ertain hard
o ,
c

ness o f hara ter whi h the others frequently have o t This

. c c c n .

o bse vation however may very probably be the mere suggestion

r , ,
 Th e S o u r c e s of R ev en u e 38 r

of fraudulent dealers whose smuggling is either prevented o r

detected by their diligence .

The inconvenien ies however which are perhaps in some c , , , ,

degree inseparable from ta xes upon consumable ommodities c ,

fall as light upon the people o f Great Britain as upon those of

any other ountry of whi h the government is nearly as expensive
c c .

O ur state is not perfect and might be mended but it is as goo d , ,

o r better than that o f m ost of o u r neighbou rs .

In consequence f the notion that duties upon consumabl e o

goods were taxes upon the profits of merchants those duties ,

have in some countries been repeated upon every successive

, ,

sale o f the goods If the profits of the merchant importer or

.

merchant manufacturer were taxed equality see med to requ ire ,

that those of all the middle buyers who intervened between

either o f them and the consumer should likewise be taxed .

The famous al avala of Spain seems to have been established

c

upon this principle It was at first a tax of ten per cent after
. .
,

wards of fourteen per ent and is at present of only six p er c .

,

cent upon the sale of every sort of property whether movabl e

.
,

or immovable and it is repeated every time the propert y is

,

sold Th e levy i
.
1
ng o f this tax requires a multitude o f revenu e
o ffi ers su fficient to guard the transportation of goods not o ly
c ,
n

from o e provin c e to another but from one shop to another

n ,
.

It subjects not only the dealers in som e sorts f goods but o ,

those in all sorts every farmer every manufa turer e v , ,

c ,
v er

merchant and shopkeeper to the continual visits and exam ina ,

tion of the t x gatherers Through the greater part of a country

a -

in whi h a tax f this kind is established nothing can be pro

c o

d u ed for distan t s al e
c The produce of every part of the ountry
. c

must be proportioned to the onsu mption of the neighbourhood c .

It is to the al avala accordingly that Usta ritz imputes t he

c , ,

ruin of the manufa tures of Spain He m ight have imputed t c . o

it lik ewise the de lension f g iult u it being imposed not

c o a r c r e,

only upon manufactures but upon the rude produ e f t h

_

c o e
,

land .

In the kingdom of N aples there is a similar tax f th ee p e o r r

c ent upon the value f all ontra ts and consequently upon

. o c c ,

that f all contracts of sale It is both lighter than the Spanish

o .

tax and the greater part of to wns and parishes are allowed
,

to pay a composition in lieu f it They levy t hi omposition o . s c

in what manner they plea e generally in a way that give s ,

s

no interruption to the interior c ommerce of the pla e Th c . e

M mi D t t m i p 455
’
1
t l e f o r es co nc erna n es ro z s , e c .
, o . . . .
38 2 T he W eal t h of N at i o n s
li
N eapo t an t a x, therefore is not ear so ru inous as the Span i sh
,
n

o ne .

The uniform system o f taxation which with a few exceptions ,

o f no great consequen e takes place in all the d ifferent partsc ,

o f the united ki gdo m o f Great Britain n leaves the interior ,

c ommerce o f the country the inland and coastin g trade almost

, ,

e ntirely free The i land trade is almost perfectly free and

. n ,

the greater part o f goods may be carried from o end f the ne o

k ingdom to the other without requiri any permit l et pass

g n or -

w ithout bei g subject to question vis it o examination from

n
, ,
r

the revenue o ffi c ers There are a few exceptions but they are .
,

s uch as a give no interru ption to any importan t branch o f

c n

t he inland ommerce f the ountry

c Goods carried c oastwise
o c .
,

indeed requir e ertifi ates or coast cockets If yo u ex ept coals

, c c -

. c ,

h owever the rest are almost all duty free

, This freedom f -

. o

i n terior commerce the e ff e t f the uniformity o f the system o f c o

,

ta xation is perhaps o e o f the prin cipal causes f t he prosperity

, n o

o f Great Britain every great country bein g necessarily the best

,

a d most extensive market fo

n the greater part f the p o r o r

o s o f its o wn industry
d uc t i n If the same freedom in o .
,
c n

sequen c e f the same uniformity could be extended to Ireland

o ,

a d the plantations
n both the grandeur o f the state and the ,

(p rosperity o f every part o f the empire would probably be stil l

greater than at present .

In France the di fferent revenue laws which take place in the

,

d ifferent provinces require a multitude o f revenue o fficers to

urround not only the frontiers o f the kin gdom but those o f
s
,

almost each particular province in order either t o prevent the ,

importation o f certa in goods o r to subject it to the payment ,

o f certa i n duties to the no small interruption o f the interior

,

c ommerce o f the country Some provin ces are allowed to com .

p ound for the gabelle o r salt tax O thers are exempted from it -

a ltogether Some prov inces are exempted from the exclusive

.

s ale o f tobacco which the farmers general enjoy through the

,
-

g reater part o f the kingdom The aides which correspond to .

,

the ex ise in England are very different in different provinces

c ,
.

Some provinces are exempted from them and pay a compos ition ,

o r equiv al ent In those in which they take place and are in

.

farm there are many lo al duties which do not extend beyond a c

particular town o distri t The traites which correspond t or c .

,

o u r customs divide the kingdom into three great parts ; first

, ,

the provinces subje t to the tariff of 664 which are called the c 1 ,

p rovinces o f the five great farms and under which are com ,
 Th e S o u r c e s of R e v en u e 8
3 3
prehended Picardy N ormandy and the greater part f the
, ,
o

interior provinces of the kingdom ; secondly the provinces ,

s ubject to the tariff of 667 whi ch are c alled the provinc es

1 ,

reckoned foreign and under whi h are omprehended the greater

,
c c

part o f t he frontier provin c es ; and thirdly those provinces , ,

which are said to be treated as foreign which because they ,

or ,

a re allowed a free c ommerce with foreign countries are in the ir ,

Commerce with the other provin es of Fran e subjected to the c c

s ame duties as other foreign ountries These are Al sa e the c . c ,

three bishoprics o f Metz Toul and Verdun and the three , , ,

c ities o f Dunkirk Bayonne and Marseilles

,
Both in the pro
,
.

vinces o f the five great farms ( alled so a c ount of an ancient c on c

d ivision o f the duties of customs into five great branches each ,

o f which was originally the subje c t of a parti ular farm though c ,

t hey are now all united into one ) and in those which are said to ,

be reckoned foreign there are many lo al duties whi h do not

,
c c

e xtend beyond a particular town o district There are some r .

s uch even in the provinces whi h are said to be treated as foreign c ,

particularly in the city f Marseilles It is unnecessary to o .

o bserve how mu h both the restraints upon the interior com

c

m erce of the country and the number of the revenue o fficers

must be multiplied i order to guard the frontiers f those
n o

d ifferent provin es and districts which are subject to such

c

d i fferent systems o f taxation .

Over and above the general restraints arising from th i s

‘

c ompli ated system

c f revenue laws the o mmerce o f wine
o ,
c ,

after corn perhaps the most i mportant production of France ,

is in the greater part f the provinces subj ect to particul ar

o

restraints arising from the favour whi h has been shown to

,
c

the vineyards o f particular provinces and distri ts above those c ,

o f others The provin ces m ost famous for their W ines it will
.
,

b e found I believe are those in whi h the trade in that article

, ,
c

i s subje t to the fewest restraints of this kind

c The extensive .

market which su h provinces enjoy encourages good manage

c ,

ment both in the cultivation of their vineyards and in the ,

s ubsequent preparation o f their wines .

Such various and c omplicated revenue laws are not pe uliar c

to Fran e The little du hy of Mil an is divided into six pro

c . . c

v inces in each o f which there is a different system o f taxation

,

w ith regard to several diff erent sorts f consumable goods The o .

s till smaller territories f the Duke o f Parma are divided into

o

three or four each o f whi h has in the same manner a system

,
c , ,

of i t s o wn Under such absurd m an agement nothing but t he

.
 8
3 4 . Th e W eal t h of N at i o n s
great fertility o f the soil and happiness f the climate could o

preserve such countries from soon relapsing into the l owest

state o f poverty and barbarism .

Taxes upon consumable ommodities may either be levied by c

an adm in istration o f whi h the officers are appointed by govern

c

ment and are immediately a countable to government o f which c ,

the revenue must in this case vary from year to year according
to the occasional variations in the produce o f the tax o they ,
r

may be let in farm for a rent certain the farmer being allowe d ,

to appoint his w o fficers w ho though obliged to levy the t ax

o n , ,

in the manner directed by the law are under his immediate ,

inspection and are immediately accountable to him The bes t

,
.

and most frugal way o f levying a tax can never be by farm .

O ver and above what is necessary for paying the stipulated rent ,

the salaries of the o fficers and the whole expense o f administra

,

tion the farmer must always draw from the produce o f the t ax
,

a certain profit proportioned at least to the advance which he

makes t o the risk which he runs to the trouble which he is at
, , ,

and t o the knowledge and skill whi h it requires to manage so c

very complicated a concern Government by establishing an .

, :3

administration under their o w immediate inspection f t he n o

same kind with that which the farmer establishes might at ,

l east save this profit which is almost always exorbitant To

,
.

farm any considerable branch o f the public revenue require s

either a great apital or a great credit ; cir umstan es which
c c c

would alone restrain the competition fo such an undertaking r

to a very small number f people O f the few wh have this o . o

capital r credit a still smaller number have the necessary

o ,

know ledge o experien c e ; another circumstance which restrains

r

the competition still further The very few who are in c o .

,
n

dition to become competitors find it more for their interest t o ,

combine together ; t o be ome copartners instead o f competitors

c ,

and when the farm is set up to auction to offer no rent but ,

what is much below the real value In countries where the .

public revenues are in farm the farmers are generally the mos t ,

Opulent people Their wealth would alone ex ite the public

. c

indignation and the vanity whi h almost always ac ompanies

,
c c

such upstart fortunes the foolish ostentation with whi h they

,
c

commonly display that wealth excites that indignation still ,

more .

The farmers o f the public revenue never find the laws t o o

severe which punish any attempt to evade the payment o f a

tax They have no bowels for the contributors who are ot
.
,
n
 T he S o u r c e s of R ev e n u e 8
3 5
their subjects and whose u iv e al b ank rup t cy if it should
,
n rs
f
a
,

happen the day after their farm is expired would not much ,

a ff e t their i
c nterest In the greatest exigencies o f the state .
,

when the a xiety of the sovereign for the exact payment o f his
n

r evenue is necessaril y the gre test they seldom fail to complain a ,

that without laws more rigorous than those which actually take
p la e
c it will be,
impossible for them to pay even the usual rent .

In those moments o f public distress their demands ca not be n

d isputed The revenue laws therefore become gradually more

.
, ,

and more severe The most sanguinary are always to be found .

i n countries where the greater part of the public revenue is in

farm ; the mildest in countries where it is levied under the ,

i mmediate inspe c tion o f the sovereign Even a bad sovereign .

feels more comp assion for his people than can ever be expected
from the farmers of his revenue He knows that the permanent .

grandeur o f his family depends upon the prosperity o f his

people and he will never knowingly ruin that prosperity for the
,

s ake o f any momentary interest o f his o w It is otherwise n .

with the farmers of his revenue whose grandeur may frequently ,

be the efiec t of the ruin and not of the prosperity of his people ,
.

A tax is sometimes not only farmed for a certain rent but ,

the farmer has besides the monopoly of the commodity taxed

, ,

In France the duties upon tobacco and salt are levied in this
,

m anner In such cases the farmer instead of o

. levies two ,
n e,

e xorbitant profits upon the people ; the profit of the farmer ,

a d the still more exorbitant one o f the monopolist

n Tobacco .

bei g a luxury every man is allowed to buy or not to buy as

n ,

he hooses But salt being a ne essary every man is obliged

c . c ,

to buy o f the farmer a certa in quantity f it ; be ause if he did o c ,

n o t buy this quantity of the farmer he would it is pres umed , , ,

buy it o f some s muggler The taxes upon both c ommodities .

a re exorbitant The t emptation to smuggle consequently is

.

to many people irresistible while at the same time the rigour ,

o f the law and the vigi lance o f the farmer s officers render the ’
, ,

yielding to that temptation almost ertainly ruinous The c .

s muggling o f salt and toba o sends every year several hundred cc

people to the galleys besides a very considerable number whom ,

it sends to the gibbet Those ta xes levied in this manner yield .

a very onsiderable revenue to gove nment In 767 the farm

c r . 1

o f toba o was let for twenty two m illions five hundred and
cc -

forty one thousand t w hundred and seventy eight livres a

-
o -

year That of salt for thirty six m illions four hundred and
.
,
-

n inety two thousand four hundre d and four livr es

-
The farm .

11 N 2
38 6 The W eal t h of N at i o n s
in both cases was to commence in 768 and to last fo r six 1 ,

years Those who consider the blood o f the people as nothing

.

in comparison with the revenue of the prince may perhap s ,

approve o f this method o f levying ta xes Similar taxes and .

monopolies o f salt and toba co have been esta blished in many

c

other ountries ; particularly i the Austrian and Prussian

c n

dominions and in the greater part o f the states o f Italy

_

, .

In France the greater part o f the a tual revenue of the crown

,
c

is derived from eight different sources ; the taille the apitation ,

c ,

the t w v igt iéme , the gabelles the aides the traites the
o n s , , ,

domaine and the farm of tobac o The five last are in t he

,
c .
,

greater part o f the provinces under farm The three first a e ,

. r

everyw here levied by an administration under the immediate

inspection and direction o f government and it is universally
_
,

acknowledged that in proportion to what they take o ut of t he

,

pockets o f the people they bring more into the treasury o f t h

,
e

prince than the other five o f which the administration is much

,

more wasteful and expensive .

The finances o f France seem in their present state to admit , ,

o f three very obvious reformations First by abolishing t he .

,

taille and the capitation and by increasing the number o f

,

v ig
n tié mes so as to produ e an additional revenue equal t o
,
c

the amount o f those other taxes the revenue o f the crown ,

might be preserved ; the expense of collection might be mu h c

diminished ; the vexation f the inferior ranks o f people whi h

o ,
c

the taille and capitation o c asion might be entirely prevented ;

c ,

and the superior ranks might o t be more burdened than the n

greater part o f them are at present The vingtieme I hav .

,
e

already observed is a tax very nearly of the s ame kind with

,

what is c alled the land tax of England The burden of the taille
-

.
,

it is acknowledged falls finally upon the proprietors of land ;

,

and as the greater part of the apitation is assessed upon those c

w h are subject to the taille at so m uch a pound f that othe

o o r

t a x the final payment o f the greater part o f it must likewise fall

,

upon the same order o f people Though the number of the vin g .

ti é mes therefore w
,
in reased so as to produ c e an additional
,
as c

revenue equal to the amount of both those taxes the superior ,

ranks o f people might not be more burdened than they are at

present Many individuals no doubt would o account o f the
.
,
n

great inequalities with whi h the taille is commonly a sessed

c s

upon the esta tes and tenants o f different in dividuals The .

ni terest and opposition o f such favoured subjects are t he

obsta cles most likely to prevent this o r any other reformation
 Th e So u r c e s of R ev e n u e 8
3 7
of the same kind Secondly by rendering the gabelle the aides
.
, , ,

the traites the taxes upon toba co all the d ifferent custom s
,
c ,

and excises uniform in all the di fferent parts o f the kingdom

, ,

those taxes might be levied at much less expense and t he ,

interior commerce o f the kingdom might be rendered as free as

that o f England Thirdly and lastly by subje c ting all thos e
.
, ,

taxes to an administration under the immediate inspection and

direction of government the exorbita nt profits f the farmers ,
o

general might be added to the revenue o f the state The .

opposition arising from the private interest o f individuals is

likely to be as effectual for preventing the two last as the fi st r

mentioned scheme of reformation .

The French system o f taxation seems in every respect , ,

inferior t o the British In Great Brita in ten millions sterling .

are annually levied upon less than eight millions of people

without its being possible to say that any particular order is
Oppressed From the collections of the Abb é Exp illy and t he
.
,

observations o f the author o f the Essay upon the legislatio n

and commerce of corn it appears probable that Fran e inc lud ,

c ,

ing the provinces o f Lorraine and Bar conta ins about twenty
thr ee o r twenty— four millions f people—three times the numbe r
,

perhaps ontained in Great Britain The soil and limate of

c . c

France are better than those o f Great Britain The ountry has . c

been mu c h longer in a state of improvement and c ultivation ,

and is upon that a count better stocked with all those things
,
c ,

which it requires a long time to raise up and a umulate such cc ,

as great towns and onvenient and well built houses both in

,
c -

town and country With these advantages it might be expected

.

that in Fran e a revenue o f thirty millions might be levied fo r

c

the support o f the state with as little inconveniency as a revenue

o f ten millions is in Great Britain In 765 and 766 the whole . 1 1 ,

revenue paid into the treasury of Fran e according to the best c , ,

though I a knowledge very imperfe t ac ounts which I ould

,
c ,
c ,
c c

get of it usually run between 308 and 3 5 m illions of livres ;

,
2

that is it did not amount to fifteen millions sterling ; t the

, no

half f what might have been expected had the people con
o

tributed in the same proportion to their numbers as the people

of Great Brita in The people o f France however it is generally
.
, ,

ack nowledged e much more oppressed by taxes than the

ar

people of Great Britain France however is erta m the great

,

.
, ,
c

empire in Europe which after that of Great Britain enjoys t he , ,

mildest and most indulgent government .

In Hollan d the he avy ta xes upon t he necessarie s o f l ife have

 Th e W e al t h o f N at i o n s
r uined it is said their prin ipal manufactures and are likely
, ,
c ,

t } d ic o u age gradually even their fisheries and their trade in

o s r

s hipbuilding The taxes upon the necessaries o f life are i

. n

c onsiderable i n Great Britain and o manufacture has hitherto ,

n

b een rui ed by them n The British taxes whi h bear hardest . c

o n manufactures are some duties upon the importation o f raw

m aterials particularly upon that o f raw silk
,
The revenue o f .

the states general and o f the different cities however is said to

-

, ,

a mount to more than five millions two hundred and fifty

thousand pounds sterling ; and as the inhabita nts o f the United
P rovinces cann ot well be supposed to amount to more than a
t hird part o f those o f Great Britain they must in proportion , ,

to their number be much more heavily taxed

,
.

After all the proper subj ects of tax ation have been exhausted ,

i f the exigencies f the state still continue to require new taxes

o ,

t hey must be imposed upon improper ones The taxes upon .

t he ne essaries o f life therefore may be no impeachment o f

c , ,

the wisdom of that republi c which in order t o a quire and to ,

c

m aintain its independency has in spite f its great frug al ity , ,

o ,

been involved in such expensive wars as have obliged it to

contra t great debts The singular countries of Holland and
c .

Z ealand besides require a considerable expense even to pre

, ,

serve their existence o to prevent their being swallowed up by

,
r

the sea whih must have contributed to in rease considerably

,
c c

the load of taxes in those t w provinces The republican form o .

o f government seems to be the principal support of the present

grandeur f Holland The owners f great capitals the great
o . o ,

mer antile families have generally either some direct share or

c ,

some indirect influence in the administration o f that govern

ment For the sake f the respect and authority which they
. o

d erive from this situation they are willing to live in a country ,

w here their capital if they employ it themselves will bring

, ,

the m less profit and if they lend it to another less interest ;

, ,

an d where the very moderate revenue which they can draw

from it will purchase less o f the necessaries and onveniences of c

life than in any other part o f Europe The residence o f su h . c

w ealthy people necessarily keeps alive in S pite o f all d ia d v a ,

s n

tages a certain degree o f industry in the country A n y public

,
.

c alamity which should destroy the republican form o f govern

ment which should throw the whole admin stration into the
,
i

hands o f nobles and of soldiers which should annihilate alto ,

~

g ether the importan c e of those wealthy mer hants would soon c ,

re nder it disagreeable to them to live in a country where they

 P u bli c D e b t s
were o longer likely to be much respected They would remov e
n .

both their residence and their capital to some other country d ,

an

the industry and commerce of Holland would soon follow t he

capitals which supported them .

CHAPTER III
OF P U B L I C D E B T S

I Nthat rude state of soc iety which precedes the extension o f

commerce and the improvement o f manufactures when thos e ,

expensive luxuries which ommerce and manufactures can alone

c

introduce are altogether unknow the person who possesses a n,

large revenue I have endeavoured to show i the third book f

,
n o

this Inquiry can spend or enjoy that revenue in no other w ay

,

t han by maintaining nearly as many people as it m aintain c an .

A large revenue may at all times be said to consist in the m co

mand o f a large quantity o f the necessaries o f life In that .

rude state of things it is commonly paid in a large quantity f o

those necessaries in the materials o f plain food and oars e

,
c

clo t hing in corn and cattle in wool and raw hides When
, ,
.

neither commerce nor manufactures furnish anything for which

t he owner can exchange the greater part f those m aterial s o

w hich are over and above his own consu m ption he can d o ,

nothing with the surplus but feed and clothe nearly as m any
p eople as it will feed an d clothe A hospit a lity in which
. ther e
is no luxury and a liberali t y in whih there is no ostentation
,
c ,

occasion in this situation of things the principal expenses o f

, ,
'

the rich a d the great But these I have likewise endeavoure d

n .
,
‘

to S how in the same book are expenses by which people e

,
ar

n o t very apt to ruin themselves There is o t perhaps an y. n , ,

selfish pleasure so frivolous f which the pursuit has not

o

sometimes ruined even sensible men A passion fo o c k— fight ig . r c n

has ru ined many But the instances I believe are not very
.
, ,

numerous of people w ho have been ruined by a hospitality o r

liberal ity of this kind though the hospita lity f luxury and t h
,
o e

liberality f ostentation have ruin ed man y Among u feudal

o . o r

ancestors the long time during which estates used to continu e

,

in the same family su ffi iently de m onstrates the gener al dis

c

position of people to live within their income Though t h . e

rustic hospitality constantly exer ised by the great land holder

c -
s

may not t o us in the present times seem consistent with that

, ,
 39 0 The W eal t h of N a t i o n s
o rder which w e are apt to onsider as inseparably connected c

with good economy yet we must certainly allow them to have

,

b ee n at least so far fru gal as not commonly to have spent their

‘

whole income A part o f their wool and raw hides they had
.

generally an opportunity o f selling fo money Some part of r .

this money perhaps they spent i purchasing the few objects

, ,
n

o f v nity and luxury with which the c ircumstan es o f the times

a c

c o uld furnish them ; but some part o f it they seem commonly

to have b o d ed They c ould o t well indeed do anything else

ar . n , ,

but hoard whatever money they saved To trade was disgrace .

ful to a gentleman and to lend money at in terest which at that

, ,

t ime was considered as usury and prohibited by law would have ,

been still more so In those times o f violence and disorder

.
,

besides it was convenient to have a hoard o f money at hand

, ,

t hat in c ase they should b e driven from their w home they o n

might have something o f known value to carry with them to

some place f safety The same violence which made it con
o .

ve in e t t o hoard made it equally convenient to conceal the

n

h oard The frequency f treasure trove

. o f treasure found
o ,
or

o f whi c h no owner was known su fficiently demonstrates the ,

frequency in those times both o f hoarding and o f concealing t he

hoard Treasure trove was then considered as an important
.

branch o f the revenue of the sovereign All the treasure trove .

o f the kingdom would s arce perhaps i the resent times make

p c n

a n im portant branch of the revenue f a pr ivate gentleman o f o

a good estate .

The same disposition to save a d to hoard prevailed in the n

s overeign as well as in the subjects A mong nations t o whom .

c om m er c e and manufactures are little know the sovereign i t n, ,

has already been observed i the fourth book is in a situation n ,

w hich naturally disposes him to the parsimony requisite f or

a ccumulation In that situation the expense even of a sove

.

reign annot be directed by that vanity which delights in the

c

g audy finery f a court The ignorance

o o f the times a ff.ords
but few o f the trinkets i which that finery onsists Standing n c .

a rmies are not then necessary so that the expense even f a o

,

sovereign like that of any other great lord can be employed i

, ,
n

s carce anything but bounty to his tenants and hospitality t o

hi s retainers But bounty and hospitality very seldom lead

.

to extravagance ; tho ugh vanity almost always does All the .

a ncient sovereigns o f F u O e a ordingly it has already been r cc

p ,

o bserve d had treasures Every Tartar chief in t he presen t

, .

t imes is said to have o e n

 P u bli c D eb t s 39 1

In a commercial country aboundi g wi t h every sort of exp en n

s i ve luxury the sovere gn

,
the same manner as almost all the
i ,
in

great proprietors in his dominions naturally spends a grea t ,

part o f his revenue in purc has ing those luxuries His own and .

the neighbouring countries supply him abundantly with all the

costly trinkets which compose the splendid b ut insignifica nt
pageantry o f a court F o the sake of an inferior pageant y o f
. r r

the same kind his nobles dismiss their retainers make their
, ,

t enants independent and become gradu ally themselves as i

,
n

signifi c ant as the greater part f the wealthy burghers in his o

domi n ions The same frivolous passions which influence their

. .

c onduct i nfluence his How an it be supposed that he should

. c

be the o nly rich man in hi dominions who is insensible t o s

pleasures o f this kind ? If he does not what he is very likely ,

t o do spend upon those pleasures so great a part o f hi

,
s revenue

as to debilitate very much the defensive power f the state it o ,

cannot well be expected that he should not spend upon them

all that part o f it which i s over and above what is necessary

for supporting that defensive power His ordinary expense .

becomes equal to his ordinary revenue and it is well if it does ,

not frequently exceed it The amass ing f treasure can no

. o

longer be expected and when extraordinary exigencies require

,

extraordinary expenses he must ne essarily call upon his sub

,
c

j e c t s for an extraordinary aid The present and the late king

.

o f Prussia are the o ly g reat princes of Europe w ho since the

n ,

d ea th o f Henry IV f France in 6 0 are supposed to have

. o 1 1 ,

amass ed any con siderable treasure The parsimony which leads .

t o acc umulation has become almost as rare in republica n as in

monarchi c al governments The Ita lian republics the United
.
,

P rovi nces o f the N etherlands are all in debt The canton of ,

.

Berne is the sin gle republic i Europe which has amassed any n

considerabl e treasure The other S wiss republics have not

. .

The taste for some sort of pag eantry for S plendid build ings at , ,

least and other public ornaments frequently prevails as m uch

, ,

i the apparently sober senate house of a little republic as i

n n -

t he dissipated co urt o f the greatest king .

The want o f parsimony in time of peace imposes the necessity

o f contractin g debt i n tim e o f war When w ar comes there i .
,
s

no money in the treasury but what is necessary for ca rying r

o n the ordinary expense f the peace establishment In w ar

o .

esta blishment of three o four times that expense becomes

r

n ecessary fo the defence of the state and onsequently a

r ,
c

revenue three o four times greater than the pe ace revenue

r .
39 2 Th e W ea l t h of N at i o n s
Supposing that the sovereign should have what he scarce ever ,

has the immediate means o f augmentin g his revenue in pro

,

portion to the augmentation o f his expense yet still the produc e ,

o f the taxes from which this increase o f revenue must be drawn

, ,

will o t begin t o come into the treasury till perhaps ten o twelve
n r

months after they are imposed But the moment in which .

w ar begins o r rather the moment in which it appears likely t o

,

begin the army must be augmented the fleet must be fitted

, ,

o u t the garrisoned towns must be put in to a posture o f defence ;

,

that army that fleet those garrisoned towns must be furnished

, ,

with arms ammunition and provisions An immediate and

, ,
.

great expense must be incurred in that moment o f immediate

danger whi h will n o t wait for the gradual and low return s
,
c S

Of the ew taxes In this exigency government can have o

n . n

o ther resource but in borrowin g .

The same commercial state o f society which by the Operation ,

o f moral auses brings government in this mann er into t he

c ,

necessity o f borrowi g produces in the subjects both an ability

n ,

and an in lination to lend If it commonly brin gs along with

c .

it the necessity o f borrowing it likewise brings along with it t he ,

facility Of doing so .

A country abounding with merchants and manufacturers

necessarily abounds with a set o f people through whose hand s
no t only their o w capitals but the capitals o f all those who
n ,

either lend them money o tru st them with goods pass as ,

r ,

frequently o more frequently than the revenue o f a pr vate

,
r ,
i

ma n, who without trade o business lives upon his income

,
r , ,

passes through his hands The revenue Of su c h a man c an .

regularly pass through his hands only once in a year But t he .

whole amount o f the capital and redit o f a merchant who deal s c ,

in a tr de o f which the retur s are ve ry quick may sometime s

a n ,

pass through his hands t w three o four times in a year o, ,

r .

A country abounding with mer hants and manufacturers there c ,

fore n e essarily abounds with a set o f people who have it at al l

,
c

times in their power to advance if they choose to d o so a very , ,

large um of money to government Hence the ability in the

s .
"

subjects o f a o mmercial state t o lend

c .

Commerce and manufactures can seldom flourish lo g in a y n n

state which does t enjoy a regular administration f justice

no o ,

in whi h the people do o t feel themselves secure in the posses

c n

sion o f their property in w hich the faith o f contracts is not

,

supported by l w and in which the authority o f the state i

a ,
s

n o t s u pposed to be regularly e mployed i enfor ing the pay ment n c

 P u bli c D e b t s 39 3
Of debts from all those who are able to pay Commerce a d . n "

man ufactures in short can seldom flourish in any sta te in

, ,

which there is o t a certain degree of confidence in the justice

n

o f gove rnment The same confidence which disposes great

.

merchants and manufacturers upon ordinary occas ions to , ,

»

trust their prope ty to the p otection o f a parti ular govern

r r c

ment disposes them upon extraordinary occasions to trust

, , ,

that government with the use o f their propert y By lending .

money t o government they do o t even fo r a moment dimin ish ,

n

their abilit y to carry o their trade and manufactures O n t he n .

contrary they commonly augment it The ne c essities f t he

,
. o

s tate render governm ent upon most occasions willing t o borro w

U pon te rms extremely advantageous to the lender The se c urity .

which it grants to the original creditor is made transferable t o

an y other reditor and from the universal confidence in t he
c , ,

j usti c e o f the sta te generally sells in the market for m ore tha n
,

w as originally paid fo it The merchant o monied man make s

r . r

money by lendin g money t o government and instead o f dim inish ,

ing increases his tradin g capital He generally considers it as

,
.

a favour therefore when the administration adm its him t o

, ,

a share in the firs t subscription for a new loan Hence t he .

inclin ation o r willin gn ess in the subjects o f a commercial sta te .

to lend .

The government Of such a state is very apt to repose itself '

u po n this ability and willingness f its subjects to lend it their o

money extraordinary occasions It foresees the fa ility o f

on . c

bo rrowing an d therefore dispenses itself from the duty o f

,

In a rude sta te o f society there are no great mercantile o r

ma ufacturin g ca pitals The individuals who hoard whateve r

n .

money they can save and who conceal their hoard do from , ,
so

a distrust f the justice o f government from a fear that if it

o ,

w as kn own that they had a hoard and where that hoard w as to ,

be found they would quickly be plundered In su h a state o f

,
. c

thin gs few people would be able d nobody would be willing ; ,

an

to lend t heir money to government o extraordinary exigencies n .

The sovereign feels that he must provide f such exigen ies by or c

savi g be ause he foresees the absolute impossibility f borrow

n ,
c o

ing This foresight in rea es still further his natural dispositio

. c s n .

t o save .

The progress o f the enormous debts which at present oppress

an d will in the long run probably ruin all the great nat ons o f
-

,
i

E urope has been pretty uniform N ations like private men .

, ,
 39 4 . The W eal t h of N a t i o n s
ave generally begun to borrow upon what may be called
h
p ersonal credit without assign ing or mortgaging
,
any parti c ular
fund for the payment o f the debt ; and when this resource has
f ailed them they have gone on to borrow upon assignments o r
,

mortgages Of parti ular funds c .

What is called the unfunded debt Of Great Britain is con

t racted in the former of those two ways It consists partly in .

a debt which bears or is supposed t o bear no interest and which

, , ,

resembles the debts that a private man contracts upon account ,

a d partly in a debt w hich bears interest and which resembles

n ,

what a private man contracts upon his bill promissory note or .

"

The debts which are due either fo r extraordinary servi es or c ,

fo r se vices either not provided for o r not paid at the time when
r ,

t hey are performed part o f the extraordin aries o f the army

, ,

n avy and ordnan e the arrears o f subsidies to foreign princes

,
c , ,

those of seame s wages etc usually constitute a debt f the

n
’
,
.
,
o

first kind N avy and exchequer bills which are issued some
.
,

t imes i payment o f a part o f su h debts and sometimes for

n c

o ther purposes constitute a d eb t o f the second kind— e xchequer

'

bills bearing interest from the day o which they are issue d n ,

a d navy bills six months after they are issued

n The Bank of .

England either by voluntarily discounting those bills at their

,

c urrent value o by agreeing with government for certain c o

,
r n

s iderations to circulate exchequer bills that is to receive them , ,

a t par paying the interest which happens to be due upon them ,

,

keeps up their value and facilitates their circulation and thereby ,

frequently enables government to contract a very large debt of

this kind In France where there is no b ank the sta te bills
.
, ,

( b ll tzd t t
e s
) have sometimes
’
e a sold
1
at sixty a d seventy per h

c ent discount During the great recoinage in King William S ’

. .

time when the Bank f England thought proper to put a stop

,
o

to its usual transactions exchequer bills and tallies are said to ,

h ave sold from twenty fiv e to sixty per cent discount ; owing -

.

partly no doubt to the supposed instability of the new gov

, ,

e me t esta blished by the Revolu t ion but partly too to the

rn n , , ,

want o f the support o f the Bank of England .

When this resource is exhausted and it becomes necessary , ,

in order to raise money to assign or mortgage some parti ular ,

c

branch o f the publi revenue for the payment Of the debt c ,

g overnment has upon different occasions done this in two

di fferent ways Sometimes it has made this assignment or
.

m ortgage fo a short period o f time only a year o r a few years

r , , ,
1
S ee E xa men d es Reflexi ti
o ns P o li qu es s ur les F i
na nc es .
 P u bl i c D eb t s 39 5
for example ; and sometimes for perpetuity In the one case .

the fund w as supposed sufficient to pay within the limited time , ,

both principal and interest o f the money borrowed In the .

o ther it w as supposed su fficient to pay the in terest only o a ,

r

perpetual annuity equivalent to the interest government b eing ,

at liberty to redeem at any time this annuity upon paying

back the principal sum borrowed When money was raised .

in the o way it was said to be raised by anticipation ; when

ne ,

in the other by perpetual funding o more shortly by fundin g

, ,
r, ,
.

In Great Brita in the annual land and malt ta xes are regularly
a nticipated every year by v i rtue o f a borrowing clause constantly
,

in serted into the acts which impose them The Bank o f England .

generally advances at an interest which since the Revolution has ,

varied from eight to three per c ent the sums for which those .
,

ta xes are granted and re eives payment as their produce

,
c

gradually comes in I f there is a deficiency whih there always

.
,
c

is it is provided for in the supplies of the ensuing year The

,
.

only considerable branch f the public revenue whi h yet remains o c

unm ortgaged is thus regularly spent before it comes in Like .

a n im provident spendthrift whose pressing occasions wil l ot ,

n

allow him t o wait for the regular payment Of his revenue ,

the state is in the constant practice f bor owing o f its w o r o n

fa ctors and agents and of paying interest for the use o f it s own
,

money .

In the reign of Kin g William and during a great part of that ,

o f Queen Anne before we had become so familiar as we are

,

n o w with the pra ti e of perpetual funding the greater part o f

c c ,

the new taxes were imposed but for a short period o f time (fo r
four five six o seven years only ) and a great part Of the
, , ,
r ,

grants o f every year consisted in loans upon anticipations o f the

produce o f those taxes The produce being frequently i uffi . ns

cient for paying within the lim ited term the principal and
interest o f the money borrowed defi iencies arose to make ,
c ,

good which it became necessary to prolong the term .

In 69 7 by the 8 th f William III

1 ,
0 the deficiencies o f
o . c . 2 ,

s everal taxes were harged upon what w as then called the first
c

general mortgage o fund consistin g o f a prolongation to the

r ,

first o f August 706 o f several different taxes whi h would

1 c

have expired within a shorter term and o f whi h the produ e ,

c c

w as a c umulated into o e general fund

c The deficiencies n .

c ha g eci upon this prolonged term amounted to

r
65 60 4 59 J ,
1 ,

1 45 gi
d -

In 1 701 , those duties with some others were still further

, ,
 39 6 The W e al t h of N at i o n s
prolonged fo r the like purposes till the first o f August 7 0 and 1 1 ,

were called the se ond general mortgage or fund The d fi c . e

cie cie charged upon it amounted to

n s 7 éd 5 . rr .

In 707 those duties were st ill further prolonged as a fund

1 , ,

for new loans to the first o f August 7 and were called t he

,
1 1 2,

third general mortgage o r fund The sum b rrowed upon it . o

w as 1 15 .
gi
d .

In 708 those duties were al l (except the o ld subsidy o f

1 ,

tonnage and poundage of which one moiety only w as made a ,

part of this fund and a duty upon the importation of Scotch,

linen which had been ta ken Off by the articles Of union ) s t il l

,

further continued as a fund for new loans to the first of August

, ,

1 7 4 and were alled the fourth general mortgage o fund

1 ,
c r .

The sum borrowed upon it was £9 95 95 d 2 . 2 .

In 709 those duties w ere all (except the Old subsidy of

1 ,

t o nn age and poundage which w s o w left o u t f this fund ,

a n o

a ltogether still further continued for the same purpose to

) t h e

first o f August 7 6 and were called the fifth general mortgage

1 1 ,

or fund The sum borrowed upon it w as £9 0 9 6

.
J
22, 2 5 .

In 7 0 those duties were again prolonged to the first Of

1 1 ,

Augu st 7 0 and were called the sixth general mortgage o r

1 2 ,

fund The sum borrowed upon it was

.
95 §d . 11 .

In 7 the same duties (whi h at this time were thus sub

1 11 c

j ect to four different anticipations ) together with several others

w ere continued for ever and made a fund for paying t he interest ,

o f the capita l of the South Sea Company which had that yea r ,

advanced to government for paying debts and making good ,

deficien ies the sum f

c , 5 5 4 d ; the greatest loa n o 1 . .

w hich at that time had ever been made .

Before this period the principal S O far as I have been able , ,

to observe the only taxes which in order to pay the interest o f

,

a debt had been imposed for perpetuity were those for paying ,

the interest o f the money which had been advanced to govern

ment by the Bank and East India Company and o f what it was ,

expe ted would be advanced but which was never advanced

c , ,

by a projected land bank The bank fund at this time amounted .

to 7 s 0% d f r which was paid

1 an annuity
. 1 o r .
,
o

interest of £ 06 5 0 3s 5 d The East India fund amounted

J
2 ,
1 1 . .

to fo which was paid an annuity r interest Of or

—the bank fund being at six per cent the East India .
,

fund at five per cent interest . .

In 7 5 by the first o f George I c

1 1 ,
t hefd iffe e t t axe s . . 1 2,
'
r n

which had been mortgaged for paying “ the bank g a uity nn ,

 P u bli c D e b t s 39 7
together with several others whi h by this a t were likewise c c

rendered perpetual were ac cumulated into o e ommon fund

,
n c

c a lled The Aggregate Fund w hich was harged not o nly with ,
c

the payments of the bank annuity but with several other ,

annuities and burdens of different kinds This fund was after .

wards augmented by the third f George I c 8 and by the o . .

,

fifth Of George I c 3 and the d ifferent duties which were then

. .
,

a dded to it were likew i se rendered perpetual .

In 7 7 by the third o f George I c 7 several other taxes

1 1 ,
. .
,

were rendered perpetual and accumulated into another common ,

fu nd called The General Fund for the paym ent f certain

, ,
o

a nnuities amount i ,
ng in the whole to 65 %d . io .

In cons quen e o f those different a ts the greater part of the

e c c ,

ta xes which before had been anti ipated o n ly for a sho rt term c

o f years were rendered perpetual as a fund for paying not the ,

capita l but the interest only Of the money whih had been
, ,
c

bo rrowed upon them by different successive anticipations .

Had money never been raised but by anticipation the course ,

o f a few year would have liberated the publi

s c revenue without
any othe r attention o f government besides that o f not over
loading the fund by hargin g it with more debt than it could
c

pay within the limited te m and of not anticipating a second r ,

time before the expiration f the first anticipation But the o .

greater part f European governments have been in apable o f

o c

those attentions They have frequently overloaded the fund

.

e ven upon the first anti ipation and when this happened cot ,
n

t o be the cas e they have generally taken care to overload it

,

by anticipating a second and a third time before the expiration

o f the first anti ipation The fund be com ing in this manner
c .

altogether insu fficient for paying both prin ipal and in t erest o f c

the money borr wed upon it it be me ne essary t charge it

o ,
ca c o

with the interest o nly o a perpetual annuity equal t o the ,

r

in terest and su c h unprovident anti ipations necessarily gave

,
c

b irth to the more ruin ous pra ti e o f pe pe t ual funding But c c r .

though this practi e ne essarily puts Off the liberation o f the

c c

public revenue from a fixed period to e so indefini t e that it on

is not very likely ever to arrive yet as a greater sum in ,

ca n

a ll cases be raised by this new practice than by the ld o f o ne o

ct ii
p a t i
o s the former n when
,
men have once beco m e familiar ,

with it has in the great exigencies o f the state been u iver ally
,
n s

preferred to the latter T relieve the present exigency is . o

a lways the Objec t whi c h prin ipally in terests those immedia t ely c

c o ncerned in the administration o f public affairs The future .

39 8 T he W eal t h of N at i o n s
liberation of the public revenue they leave to the care of
posterity .

During the reign of Queen Anne the market rate Of interest ,

had fallen from six to five per cent and in the twelfth year Of .

her reign five per cent was declared to be the highest rate .

whi h could lawfully be taken fo money borrowed upon private

c r

security Soon after the greater part o f the temporary taxes

.

o f Great Britain had been rendered perpetual and distributed ,

into the Aggregate South Sea and General Funds the reditors
, , ,
c

Of the public like those of private persons were indu ed t o

, ,
c

a cept o f five per cent for the interest of their money which
c .
,

occasioned a saving of o per cent upon the capital f t he ne . o

greater part o f the debts which had been thus funded for per
pe t u i
t y o of
,
e sixth
r o f the greater part
on of-

the annuities
which were paid out f t he three great funds above mentioned o

This saving left a considerable surplus in the produ e o f the c

different taxes which had been accumulated into those funds

over and above what was necessary for payin g the annuitie s
which were now charged upon them and laid the foundation o f ,
.

what has sin e been called the Sinking Fund In 7 7 it

c . 1 1

amounted to 75 7% d In 7 7 the interest o f the . . 1 2 ,

greater part of the public debts was s t ill further reduced t o

.

four per c ent ; and in 75 3 and 75 7 to three and a half and

. 1 1 ,

three per ent ; whic h reductions still further augmented the

c .

sinking fund .

A s inking fund though instituted for the payment o f o ld

, ,

facilitates very much the contracting o f new debts It is a .

subsidiary fund always at hand to be mortgaged in aid o f any

other doubtful fund upon whi h money is proposed to be raised c

in any exigen y o f the state Whether the sinking fund of

c .

Great Britain has been more frequently applied to the one r o

to the other o f those two purposes will su ffi iently appear by c

and by .

Besides those two methods of borrowing by anticipations ,

.

and by pe petual funding there are two other methods which

r ,

hold a sort Of middle place between them These are that o f .

,

borrowing upon annuities for terms Of years and that o f ,

borrowing upon annuities fo lives r .

During the reigns o f King William and Queen An ne l arge ,

sums were frequently borrowed upon annuities fo terms o f r

years which were sometimes longer and sometimes shorter

,
.

In 69 3 an act w a passed for borrowing o e million upon an

1 ,
s . n

annuity o f fourteen per cent or o f a year for sixtee n .

,
 P u bli c D e b t s 39 9
years In 69 an act was passed for borrowing a million upo n
. 1 1,

annuities for lives upon terms whi h in the present times would
,
c

appear v ery advantageous But the subscription w as t fille d . no

up In the following year the defi iency was made good by

. c

borrowin g upon annuities for lives at fourteen per cent o at .

,
r

l ittle more than seven years purchase In 69 5 the person s ’

. 1 ,
.

w ho had purchas ed those annuities were allowed to ex hang e c

them for others f ninety six years upon paying into the
o -

Exchequer sixty three pounds in the hundred ; that is t he

-

difference between fourteen per ent for life and fourteen p e c .

,
r

cent for ni ety six years was sold for sixty three pounds o
. n -

,
-

,
r

for four and a half years purchase Such w as the supposed ’

.

i nstability o f government that even these terms procured few

purc hasers In the reign f Queen Anne money was upon
. o

di fferent oc asions borrowed both upon a nuities for lives and

c n ,

upon annuities for terms f thirty two o f eighty nine of n inety o -

,
-

,
~

eight and o f ninety nine years In 7 9 the proprietors f t he

,
-

. 1 1 ,
o

annuities for thirty two years were induced to a ept in lieu o f

-

cc

the m South Sea stock to the amount of eleven and a half years ’

purchase of the annuities together with an additional quantity ,

o f stock equ al to the arrears whi c h happened then to be d u e

upon them In 7 0 the greater part o f the other annuitie
. 1 2 ,
s

for terms f years both long and short were subscribed i to t he

o n

same fund The long annuities at that time amounted t

. o

8 3% d a year 5 O.n the st h f

. January 77 5 the . o 1 ,

remainder of them or what was not subscribed at that time

, ,

amounted only to 8d 1 25 . .

During the two wars which began in 739 d i 75 5 littl e 1 an n 1 ,

money was borrowed either upon an uities f terms f years n or o ,

or upon those for lives An annuity for ninety eight or ninet y .

-

nine years however is worth nearly as much money as a per

, ,

p e t u it y an d should
,
therefore e might t hink be a fund f
, ,
on , or

borrowing nearly as much But those wh in order to mak e . o,

family settlements and to provide f remote fu t urity b uy

,
or ,

i nto the public stocks would not care to purchase into o e , n

o f whi h the value was continually diminishing ; a r

c id such
people make a very onsiderable proportion both Of the p c ro

p i
r e t o and pur
rs hasers of stock An can uity f a long term . n or

o f years therefore though its intrinsi value may be very

, ,
c

nearly the same with that of a perpetual annuity will not fi d ,

n
'

nearly the same number o f purchasers The subscribers to a .

new loan w ho mean generally to sell the ir subs ription as soo

, c n

as possible prefer greatly a perpetual annuity redeemable by

,
 The W eal t h of N at i o n s
p arliament
. to an irredeemable annuity for a long term o f years
o f only equal amount The value of the former may be sup
.

p osed always the same r very nearly the same and

, it omakes , ,

”therefore a more convenient transferable sto k than the latter c .

During the two last mentioned wars annuities either for -

, ,

terms Of years o for lives were seldom granted but as premiums

. r ,

t o the subscribers to a new loan over and above the redeemable

.

a nnuity or interest upon the credit o f whi h the loan w as c

s upposed to be made They were granted not as the proper

.
,

f und upon which the money was borrowed but as an additional

,

e n ouragement to the lender

c .

Annuities for lives have occasionally been granted in two

d i fferent ways ; either upon separate lives or upon lots o f lives , ,

w hich in French are called Tontines from the name o f their ,

inventor When . uities a r e granted upon separate lives the

ann ,

death of eve ry individual annuitant disburthens the public

evenue so far as it w as affected by his annuity When annuities
r .

are granted upon tontines the liberation of the public revenue ,

d oes not commence till the death of all the an uitants compre n

h ended in one lot which may sometimes consist o f twenty o r

,

t hirty persons f whom the survivors succeed to the annuities

"

,
o

o f all those w h die before them the last survivor succeeding

o ,

to the annuities f the whole lot Upon the same revenue more
o .

m oney can always be raised by tontines than by annuities for

separate lives An annuity with a right of survivorship is
.
, ,

really worth more than an equal annuity for a separate life and ,

from the confidence which every man naturally has in his o wn

g ood fortune the principle
,
upon which is founded the success
o f all lotteries such an annuity generally sells for something
,

more than it is worth In countries where it is usu al f r govern

. o

m e t to raise money by granting annuities tontines are upon

r
n ,

this account generally preferred to annuities for separate lives .

The expedient which will raise most money is almost always

preferred to that which is likely to bring about in the speediest
manner the liberation of the publi revenue c .

In Fran e a much greater proportion Of the public debts

c

consists in annuities for lives than i England According to n .

a memoir presented by the parliament Of Bordeaux to the king

in 764 the whole public debt of France is estimated at twenty
1 ,

four hundred millions o f livres o f which the capital fo r which ,

a nnuities for lives had been granted is supposed to amount to

three hundred millions the eighth part of the whole public debt
‘

,
.

The annuities themselves are computed to amount to thirty

‘
 P u bli c D e b t s
mi llions a y ear the fourth part o f o e hundred an d twenty
,
n

millions the supposed in terest o f that whole debt These esti

,
.

mations I know very well are not exact but having been
, , ,

presented by so very respectable a body as approximat ons t o i

the truth they may I apprehend be considered as such It is

, , ,
.

n o t the di ff erent degrees f anxiety in the two governments o f o

Fran c e an d Englan d for the liberation o f the public revenu e

which occasions this d ifference in their respective modes f o

bo rowin g It arises altogether from the di fferent views d

r . an

interests o f the lenders .

I n England the seat o f governm ent bei g in the greatest

,
n

mercan tile city in the world the merchants are generally t he ,

people w ho advance money to government By advancing it .

they do not mean to dimi ish but o n the contrary to in creas e n , , ,

their mercantile capitals and unless they expected to sell with ,

some profit their share in the subscription f a new loan they or ,

never would subscribe But if by advan ing their money they . c

were to purchas e in stead o f perpetu al ann uities annuities fo r

, ,

lives only whether their w o those f other people they

,
o n r o ,

would o t always be so likely to sell them with a profit

n .

An nuities upon their o w lives they would a lways sell with n

loss because no man will give for an annuity upon t h e life o f

,

another whose age and state of health are nearly the same with
,

his w the same price which he would give for one upon hi
o n, s .

ow n An annuity upon the life f a third person i deed is no

. O ,
n , ,

doubt Of equal val ue to the buyer and the seller ; but its real
,

val ue begins to diminish from the m oment it is granted and ,

continues to do so more and more as long as it subsists It . .

can never therefore make so convenient a transferable sto k as

, ,
c

a perpetu al annuity f which the real value may be supposed ’

,
o

always the same very nearly the same ,

or .

In Fran e the seat f government not bei g in a great m

c ,
O n er

le city mercha ts do not make so great a proportion f

c an t i ,
n o

the people w ho advance money to govern ment The peopl e .

con erned in the fin an es the farme s general the receivers o f

”

c c ,
r -

the taxes which are not in farm the c ourt bankers t c m ak e , ,

e .
,

the greater part f those w h advan e their money in all public

o o c

exigencies Such people are commo ly men of m ean birth but

. n ,

o f great wealth d frequently f gr eat pride

,
The y are t
an o . oo

proud to m arry their equ al s and women o f quality disdain ,

to marry them They frequently resolve therefore to live

.
, ,

bachelors and having neither any families f their w

, o o n, nor

much regard f those o f their relations whom they are not

or ,
4 02 Th e W e al t h of N at i o n s
al ways very fond o f acknowledging they desire only to live in ,

splendour during their own time and are not unwill ing that
“

t heir fortune should end with themselves The number of rich .

p eople besides,
w h are either averse to marry or whose condi
,
o ,

t ion Of life renders it either improper or inconvenient for them

t o do so is much greater in France than in England
, To such .

p eople w h have little o r no care for posterity nothing can be

,
o ,

m ore convenient than to exchange their capital for a revenue

which is to last just as long and no lo ger than they wish it ,
n ,

t do
o .

The ordinary expense of the greater part o f modern govern

m ents in time of peace being equal o r nearly equal to their
o rdinary revenue when w comes they are both unwilling an d
,
ar

unable to increase their revenue in proportion to the increase of

t heir expense They a e unwil l ing for fear Of offending the
. r
“

people who by so great and so sudden an increase f taxes

, ,
o ,

w ould soon be disgusted with the war ; and they are unable
f rom not well knowing what taxes would be su fficient to pro
-
d uce the revenue wanted The facility f borrowin g delivers . o

them from the embarrassment which this fear and inability

would otherwise occasion By means of borrowing they are .

e nabled with a very moderate increase of taxes to raise from

, , ,

y ear to year money suffi cient for

,
carry ng
i o the war and by n ,

t he practice o f perpetually funding they are enabled with the ,

s mallest possible in rease of taxes t raise annual l y the largest

c ,
o

possible sum o f money In great empires the people who live .

i the capital and in the provinces remote from the scene o f

n ,

a ction feel many of them scarce any inconveniency from the

, , ,

w ar ; but enjoy at their ease the amusement o f reading in the

, ,

ewspapers the exploits of their own fleets and armies To

n .

t hem this amusement compensates the small difference between

the taxes which they pay on account of the war and those ,

which they had been accustomed to pay in time f peace They o .

a e commonly dissatisfied with the return o f peace which puts

r ,

a end to their amusement and to a thousand vision ry hopes

n ,
a

f conquest and national glory from a l onger continuance of

o

t he w a r .

The return Of peace indeed seldom relieves them from the , ,

g reater part o f the taxes imposed during the w ar These are .

mortgaged for the interest of the debt contracted in order t o

c arry it o If over and above paying the interest o f this debt
n .
, ,

a d defraying the ordinary expense o f government

n the ol d ,

r evenue together w i th the new taxes produce some surplus

, ,
 P u bl i c D e b t s 0
4 3
r evenue it may perhaps b e converted into a sinking fund for
,

p aying o f
f the debt But in the first place th is
. sinking fund , , ,

e ven supposing it should be applied t o no other purpose is ,

g enerally altogether inadequate fo r paying in the course of ,

a y period during which it can reasonably be expected that

n

p eace should continue the whole debt contracted during

,
the
wa ; and i
r n the second place this fund is almost always applied
, ,

t o other purposes .

The new taxes were imposed for the sole purpose of paying
t he interest f the money borrowed upon them
o If they pro .

duce more it is generally something which was neither intended

,

nor expected and is therefore seldom very considerable Sink

,
.

ing funds have generally arisen not so mu c h from any surplus

o f the taxes whi h was over and above what w as necessary for
c

paying the interest o r annuity originally charged upon them ,

a s from a subsequent redu tion of that interest That of Holland

'

c .

in 65 5 and that of the ecclesiasti al sta te in 685 were both

1 ,
c 1 ,

formed in this manner Hence the usual insufficiency Of such .

funds .

During the most profound peace various events occur which

r equire an extraordinary expense and government finds it ,

a lways more convenient to defray thi s expense by misapplying

t he sinking fund than by imposing a new tax Every new tax .

is immediately felt more o less by the people It occasions r .

a lways some murmur and meets with some Opposition ,

The .

more taxes may have been multiplied the higher they may ,

have been raised upon every different subject f taxation ; the o

more loudly the people complain o f every ew tax the more n ,

d i fficult it becomes t o o either to find o u t new subjects Of taxa

, ,

tion o to raise much higher the taxes already imposed upon

,
r

the Old A momenta ry suspension of the payment o f debt is

.

ot
n immediately felt by the people and occasions neither ,

murmur n o complaint To borrow o f the sinking fund is

r .

a lways an Obvious and easy expedient fo getting o ut o f the r

present d iflic ult y The more the public debts may have been
.

a ccumulated the more necessary it may have be c ome to study

,

to reduce them the more dangerous the more ruinous it may

, ,

be to misapply any part of the sinking fund ; the less likely is

the public debt to be reduced to any considerable degre e the ,

more likely the more ce rtainly is the sinking fund to be mis

,

a pplied to wards defraying all the extraordinary ex enses which

p .

o ccur in time o f peace When a nation is already overburdened

.

w ith ta x es nothin g but the necessities o f a n ew w a

,
nothing r,
 W e al t h of N at i o n sThe
but ither the an imosity of national vengeance or the anxiety
e ,

fo r national security can induce the people t o submit with , ,

tolerable patience to a new tax Hence the usual misapplic a,

.

tion Of the sinking fund .

In Great Britain from the time that we had first re c ourse ,

to the ru inous expedient o f pe rpetual funding the reduction Of ,

the public debt in time o f peace has never borne any pro
portion to its accumulation in time o f w a It w as in the war r .

which began in 68 8 and w concluded by the Treaty o f 1 ,

as

Ryswick in 69 7 that the foundation of the present enormou s

1 ,

debt o f Great Britain was first laid .

O n the 3 t Of December 69 7 the public debts of Great

15 1 ,

Britain funded and unfunded amounted to

, 3s 8 5d ,
1 . .

A great part Of those debts had been contracted upon shor t

ant cipat ons and some part upon annuities for lives so that
i i , ,

before the 3 t o f December 70 in less than four years there

15 1 1, ,

had partly been paid Off and partly reverted to the public , ,

the sum Of £5 4 5 % ;
d a greater
,
1 2reduction
1 ,
o o f the r 12 . o .

public debt than has ever since been brought about in so short
a period f time The remaining debt therefore amounted
o .
, ,

only to 5 75d 1 . .

In the w ar which began in 70 and which was concluded 1 2,

by the Treaty f Utrecht the public debts were still more

o ,

accumulated On the 3 t o f De ember 7 4 they amounted

. 15 c 1 1 ,

to £5 3 68 76 5 6——d The subs ription into the South Sea

,
r,o s .
1
1 2 . c

fund o f the short and long annuities increased the apital o f the c

public debts so that the 3 5 t of December 7 it amounted

,
on 1 1 22

to 5 32 d The reduction o f the

1 debt . began in r .

1 7 3 and went on so slowly that on the 3 5 t of December 739

2 , ,
1 1 ,

during seventeen years o f profound peace the whole sum paid

—
,

Off was no more than 7s fi

j d the capital of the i . rr ”
public debt at that time amounting to 3 3 4 fg d s . .

The Spanish war which began in 739 and the French war ,
1 ,

whi h soon followed it o casioned a further in rease of the

c ,
c c

debt whi h on the 3 t of De ember 74 8 after the war had

,
c ,
15 c 1 ,

been con luded by the Treaty o f Aix la Chapelle amo unted t

c - -

,
o

5 g
d The most profound
1 . peace
ro of seventeen .

years continuan e had ta ken no more than £8

’
c 7
B d
I g ,
1 5 . 1I '
’
.

from it A war o f less than nine years continuance added

.
’

68 9 8 63 d to it 1 5 . . .
1

During the administration of Mr Pelham the interest o f the .

,

public debt w as reduced or at least measures were taken fo r ,

S J m P t l t hw it H it y f th P bi
1
ee a es i R os e a e s
’
s or o e u e even u e .
 P u bli c D e b t s
redu in g it from four to three per cent ; the sink ing fund w as
c ,
.

in reased and some part o f the public debt was paid o ff In

c ,
.

75 5
1 before the breaking
,
o u t o f the late w a r the funded debt ,

o f Great Brita in amounted to £ 7 O the 5 t h Of 2, n

January 763 at the conclusion f the peace the funded debt

1 ,
o ,

amounted to 85 5d The unfunded debt has . 2 .

been sta ted at £ 5 89 d But the expense occas ioned

1 25 . 2 .

by the war did t end with the conclusion f the peace so no o ,

that though the 5 t h o f January 764 the funded debt was

,
on 1 ,

increased (partly by a new loan and partly by funding a part ,

o f the unfunded debt ) to 05 2d ther still,

1 . 1 .
,
e

remained (according to the ve ry well in formed author of the

C on s i
der a ti
on s on the Tr ad e a nd F i
n a nc es o f Gr ea t B r i
t a i
n
) an

unf unded debt which was brought to a ount in that and the cc

followin g year Of ig d In 764 therefore the 1 25 . z . 1 , ,

pub li debt o f Great Britain funded and u n funded together

c , ,

a mounted according to this author t £ 39 5 6 8 7

, 4d ,
o 1 ,
1 ,
o 25 . .

The annuiti es fo lives too which had been gr anted as pre miums r , ,

to the subs ribers to the new loans in 75 7 estimated at fourt een

. c 1 ,

years purcha e were valued at

’
and the annuities for
s ,

long te ms f years granted as premiums likewise in 76 and

r o ,
1 1

76 estimated at twenty seven an d a half years pur hase were

’
1 2, -

c ,

valued at During a peace f about seven years o

’

continuan e the prudent and truly patriot administration of

c ,

Mr Pelham w as t able t o pay ff an ld debt f six millions

. no o o o .

During a w ar o f nearly the same continuan e a new debt of c ,

more than seventy fi millions was ontra ted -

ve c c .

O n the 5 t h of January 775 the funded debt of Great Brita in 1 ,

amounted to 65d The u nf unded exclusive 15 . .

,

f a large ivil list debt to £4 5

o 6
3 3
c g d Both together , ,
r o ,z s . 11 .
,

to 5 6d A ordi g to this a count the whole s . . cc n c

debt paid Off during eleven years profound pea e amounted ’

c

o nly to —
6s 9 d Even this s mall redu tion o f 1 . . c

debt however has not been all made from the savings o ut o f
, ,

the ordi ary revenue f the sta te Several extraneous sums

n o .
,

altogether independent o f that ordinary revenue have o ,

c n

tributed towards it Amongst these we may reckon an additional .

s hilling in the pound land tax for three years ; the t w millions -

received from the East India Company as indem nification

for their te ritorial a quisitions ; and the one hundred an d ten
r c

thousand pounds received from the bank f the renewal of or

their harter To these must be added several other sums

c .

whi h as they arose out o f the late w a ought perhaps t o be

c ,
r,
4 0 6 T he W eal t h of N at io n s
considered as d eductions from the expenses of it . The principa l
are ,

5 . d .

The produce Of F e c h prizes '

r n .
18
9
Composition for Frenc h prisoners 0 0
What has been received from the sale of the
ceded islands 0 0

Total 18 9

If w e add t o this sum the bal ance o f the Earl of Chatham s an d ’

Mr Calc aft s accounts and other army savings of the same

. r
’
,

k ind together with what has been received from the bank t he
, ,

Eas t India Company and the additional shilling in the pound ,

l and t a x the whole must b ea good deal more than five millions
-

,
.

The debt therefore whi h since the peace has been paid out o f
, ,
c

the s avings from the ordinary revenue o f the state has not o e , ,
n

y ear with another amounted to half a million a year ,

T he .

s inking fund has no doubt been considerably augmented sinc e

, ,

the peace by the debt which has been paid o ff by the redu tion
, ,
c

o f the redeemable four per cents to three per cents and by . .

,

the annuities for l ives whi h have fallen in and if peace were c , ,

to continue a million perhaps might now be annually spare d

, , ,

o u t o f it towards the discharge o f the debt A nother million .

,

ac c ordingly w s paid in the course f last year ; but at the sam e

,
a o ,

time a large civil list debt was left unpaid and w e are o w
, ,
n

involved in a new war which in its progress may prove as , ,

expensive as any Of our former wars The new debt whi h will .
1
c

probably be contrac ted before the end of the next campaig n

may perhaps be nearly equal to all the o ld debt which has bee n
paid ff from the savings ut o f the ordinary revenue Of t he
O o

state It would be altogether chimeri al therefore to expect

. c , ,

that the public debt should ever be ompletely dis harged by c c

a y savings which are likely to be made from that ordinary

n

revenue as it stands at present .

The public funds of the di fferent indebted nations o f Europe ,

particularly those o f England have by one author been e ,

r

presented as the accumulation f a great apital superadded o c

to the other capital o f the country by means of which its trad e ,

1
It h p vdm as x p iv t hro y f e f m w ; dho re e en s e an an o o ur or er ar s an as
i v lv d
n o eddi t i l d b t f m t h
us in an h d d milli
a ona e o o re an one un re ons
D i g p f dp f l v y litt l m t h t milli
.

ur n a r o o un f
ea c e o e e en e ar s , e o re an en ons o
d b t w p id ; d i g w f v y
e as a m thur n h d d a ar o se en ear s , o re an o ne un re
m illi w ons t t d as c o h r ac e .
 P u bli c D eb t s 0
4 7
is extended its manufactures multiplied and its lands cultivate d
, ,

and improved mu h b eyond what they coul d have be n by c e

means of that oth er capita l only He does not onsider tha t . c

the capital whih the first creditors f the public advanced t o

c o

government w as from the moment in which they advanced it

, ,

a certa in portion o f the ann ual produce turned away fro m

serving in the function o f a capital to serve in that o f a revenue ;
from maintain ing productive labo urers to mainta in unproductiv e
ones and to be spent and wasted generally in the course o f t he
, ,

year without even the hope Of any future reproduction In

,
.

return for t h ca pital which they advan ced they Obta in ed

e ,

in deed an annuity in the public funds in most cases o f more

,

than equal value This annuity no doubt replaced to the m

.
, ,

their capi t al an d enabled them to ca rry on their trade an d

,

business to the same or perhaps to a greater extent than before ;

that is they were enabled either to borrow of other pe ople a
,

new capital upon the credit f this nuity or by selling it to o an ,

get from other people a new capital of their o w equal o r n

superior to that which they had advanced to government This .

new capital however which they i this manner either bought

, ,
n

or borrowed o f other people must have existed in the co untry ,

before an d must have been employed as all apitals are in

, ,
c ,

maintaining productive labo ur When it cam e into the hands .

o f those who had advanced their money to government though ,

it w as in some respects a ew apital to them it was o t so t o n c ,

n

the country but was o ly a capital withdrawn from erta in

,
n c

employments in order to be turned towards others Though is .

replaced to them what they had advanced to government it ,

di d not replace it to the country Had they not advanced thit .

capital to government there would have been in the country ,

t w o capitals two portions of the annual produ e instead

,
f c ,
o

on e, employed in mainta in ing productive labour .

When for defraying the expense of government a revenue is

raised within the year from the produ e of free or unm ortgaged c

taxes a certain port on f the revenue of private people only

,
i o is

turned away from maintaining e species Of unproductiv e on

labour towards mainta ini g an other Some part o f what they n .

ay in those taxes m ight no doubt have been ac umulated

p c

into capital and consequently employed i maintaining produc

, n

tive labour but the greater part would probably have bee
, n

spent and consequently e mployed i mainta in ing u productive n n

labour The public expens e however when defr ayed in t his

.
, ,

manner no doubt hinders more o r less the further accumula

,
4 08 The
W e al t h of N at i o n s
t ion of new cap i tal ; but i t does not necessarily occasion the
d estruction o f any actually existing capital .

When the public expense is defrayed by funding it is defrayed ,

by the annual destruction f some capital which had before o

e xisted in the country ; by the perversion o f some port i on f o

the annual produce which had before been destined for the
maintenance of productive labour towards that of unproductive
l abour As in this case ho w ever the taxes are lighter than they
.
, ,

would have been had a revenue sufli c i t for defraying the same en

e xpense been raised within the year the pr vate revenue of ,

i

individuals 1 necessarily less burdened and consequently their

5 ,

a bility to save and accumulate some part o f that revenue into

c apital is a good deal less impaired If the method o f funding .

destroys more Old capital it at the same time hinders less the ,

accumulation or acquisition f new apital than that of defray o c

ing the public expense by a revenue raised within the year .

Under the system of funding the frugality and industry f , o

p rivate people can more easily repair the breaches which the
w as te and extravagance f government may o c casionally makeo

i n the general apital f the so iety

0
c o c .

It only during the ont nuan c e of war however that the

IS c i , ,

s ystem of funding has this advantage over the other system .

Were the expense o f war to be defrayed always by a revenue

raised within the year the taxes from which that extraordinary
,

revenue was drawn would last no longer than the war The .

ability f private people to accumulate though less during the

o ,

w ar would have been greater during the peace than under the
,

system of funding War would not ne c essarily have oc asioned

. c

the destruction f any old capitals and peac e would have o ca

o ,
c

si o ed the accumulation of many more new

n Wars would in .

general be more speedily concluded and less wantonly under ,

taken The people feeling during the continuan e of the w

.
,
c ar ,

the complete burden of it would soon grow weary f it and ,

o ,

g overnment in order to humour

,
them would not be under the
necess ty o f carrying it on longer than it w necessary to do
i as

so . The foresight of the heavy and unavoidable burdens f o

w a would hinder the people from wantonly calling fo r it when

r

there w as no real or solid interest to fight for The seaso n s .

during which the ability of private people to accu mulate w as

s omewhat impaired would o cur more rarely and be f shorter c ,

o

c ontinuance Those on the contrary during which the ability

.
, ,

w asin the highest vigour would be f mu h longer duration o c

than they can well be under the system o f funding .

 P u bli c D eb t s 0
4 9
When funding besides has made a ertain progress the
, ,
c ,

multiplication of taxes whi h it brings along with it sometimes c

impairs mu h the abil ity o f private people to a cumulate even

as c c

in tim e o f pea e as the other system would in time f war The

c o .

peace revenue f Great Britain amounts at present to more than

o

ten millions a year If free and unmortgaged it might be

.
,

sufficient with proper management and without contracting

,

a shilling of new debt to arry o the most ig o u war The

,
c n A
v or s .

private revenue o f the inhabitants o f Great Britain is at present

as much encumbered in time Of peace their ability to a cumulate ,
c

is as mu h impaired as it would have been in the time o f t he

c

most expensive w had the pernicious system o f funding never

ar

been adopted .

In the payment of the interest o f the public debt it has been ,

said it is the right hand which pays the left The money does
,
.

n o t go out of the country It is o ly a part of the revenue f . n o

o n e set o f the inhabitants whi h is transferred to another and c ,

the nation is not a farthing the poorer This apology is founded .

al together in the sop hi stry f the me antile system and after o rc ,

the long examination w hich I have already bestowed upon that

system it may perhaps be unne essary to say anything further
,
c
—
about it It supposes besides that the whole public debt is
.
, ,

owing to the inhabitants of the country whi h happens not t ,

c o

be true ; the Dutch as well as several other foreign nations

, ,

having a very considerable share in o u publi fu ds But r c n .

though the whole debt were owing to the inhabitants f the o

country it would not upon that ac cou t be less perni ious

,
n c .

Land and capital sto k are the two original sources o f all c

revenue both private and public Capital stock pays the wages .

o f productive labour whether employed i agriculture manu

,
n ,

fa tures o commerce The manage ment f those two original

c ,
r . o

sources of revenue belongs to two different sets f people ; the o

proprietors of land d the owners o employers o f capital

,
an r

stock .

The proprietor f land is interested for the sake of his w

O o n

revenue to keep his es t ate in as good condition as he a by c n,

building and repairing his tenants houses by making d main ’

,
an

taining the ne essary drains and en losures and all those Other
c c ,

expensive improve ments whi h it properly belongs t t h land c o e

lord to make and main tain But by different land taxes the .
-

revenue o f the landlord may be so much dimin ished and by ,

different duties upon the necessaries and conveniencies o f life

that diminished revenue may be rendered o f so little real value ,

11 0
4 10 W ea l t h of N a t i Th e
o n s
that he may find himself al together unable to make maint in or a
those expensive i mprovements When the l andlord however .
, ,

ceases to do his part it is altogether impossible that the tenant

,

should continue to do his As the distress o f the landlord i . n

c reases the agri c ulture

,
ithe country must necessarily decline o .

When by different taxes upon the necessaries and c o v e i

, n n

e ci
n e of life the owners and employers o f apital stock find
s ,
c

that whatever revenue they derive from it will not in a parti ,

c ul arcountry pur hase the same quantity o f those necessaries

,
c

and onveniencies which an equal revenue would in almost any

c

other they will be d isposed to remove to some other And

, .

when in order to raise those taxes all o the greater part of

, ,
r

merchants and manufacturers that is all or the greater part o f , ,

the employers o f great capitals ome to be continually exposed ,

c

to the mortifying and vexatious visits o f the tax ga t he e s t his -

r r ,
s

disposition to remove will soon be changed into an actual

removal The industry o f the country will necessarily fall with
.

the removal of the capital which supported it and the ruin of ,

trade and manufactures will follow the declension o f agriculture .

To transfer from the owners of those two great sources o f

revenue land and capital stock from the persons immediately
, ,

interested in the good condition o f every particular portion o f

land and in the good management o f every particular portion
,

Of capi t al stock to another set o f persons (the creditors of the

,

public who have no such particular interest) the greater part

, ,

o f the revenue arising from either must in the long run occa ,
-

sion both the negle t of land and the waste o removal o f c ,

r

capital stock A creditor o f the public has no doubt a general

.

interest in the prosperity o f the agriculture manufactures and , ,

commerce Of the country and consequently in the good condi ,

tion o f its lands and in the good management o f its capital

,

stock Should there be any general failure o r declension in any

.

of these things the produce o f the different taxes might no

,

longer be sufficient to pay him the annuity o r interest which is

due to him But a creditor of the public considered merely as
.
,

such has no interest in the good condition o f any particular

,

portion o f l and o in the good management o f any particular

,
r

portion o f capita l stock As a creditor o f the public he has no .

knowledge o f any such particular portion He has no isp ec . n

tion o f it He can have no care about it Its ruin may in

. .

some cases be unknown to him and cannot directly affect him ,

.

The practice o f funding has gradually enfeebled every state

w hich has adopted i t The Italian republics seem to have .
 P u bli c D eb t s 4 1 1

begun it Genoa and Venice the o nly two remain ing whi c h
pretend to an id p d i
.
,

c an t existen e have both been e n e en er c n

feebled by it Spain seems t o have learri

,

. ed the pra c tice from

the Italian republi s and (its ta xes being probably less judicious
c ,

than theirs ) it has in proportion to its natural strength been , ,

s till more enfeebled The debts o f Spain are o f very Old stand
.

ing It w as deeply in debt before the end o f the six teenth

.

c entury about a hundred years before England owed a shilling

,
.

France notwiths tan d ing all it s natural resour es la guishes

,
c ,
n

u nder an oppressive load of the same kind The repub lic o f .

t h e U nited Provin ces is as much e nf eebled by its debts as either

Genoa r Veni e o Is it likely that in Great Bri t a in alone a
c .

p ractice whi h has brought either weakness

c o desolation into r

e very other coun t ry should prove altogether i no ent ? n c

The system Of taxation established in those different coun t ries ,

it may be said is inferior to that of England I believe it is

,
.

so But it ought to be remembered that when the wisest

.
,

g overnment has exhausted all the proper subject s Of axation

t ,

it must in cases o f urgent ne essi t y have recourse to improper

,
c ,

o nes The wise republic o f Holland has u pon some occa s ons
. i

been obliged to have re ourse to taxes as inconvenient as the c

greater part o f those o f Spain An other war begun before any .

c onsiderable l iberation o f the public revenue had been brought

a bout and growing in its progress as expensive as the last war

, ,

m y fro m irresistible ne c essi t y render the British system f

a , ,
o

t axation as oppressive as that o f Holland o even as that f ,

r o

S pain To the honour o f o u present system o f taxation indeed

. r , ,

i t has hitherto given so little embarras sment to industry that ,

d uri g the course even of the most expensive wars the frugality
n ,

a n d good onduct o f individuals seem to have been able by

c ,

s avin g and a umulation to repair all the breaches whic h the

cc ,

w aste and extravagan e o f government had made i the genera l c n

c apital f the society At the c on lusion o f the late war the

O . c ,

m ost expensive that Great Britain ever waged her agri ulture ,
c

w as as flourishing her ma ufacturers as numerous and ,

fully n as

e mployed and her commer e as extensive as they had ever

,
c

b een before The capital therefore whih supported all those

.
, ,
c

d ifferent bran hes o f i ndustry must have been equal to what it

c

had ever been before Sin ce the peace agricult ure has been .
,

still further improved the rents o f houses have risen in every

t o w n and vill age of the country— proof f the in reas i
,

ng wealth a o c

and revenue o f the people and the annual amount o f the ,

g reater part o f the o ld taxes o f the princip al bran h es Of the ,

c
 4 12 Th e W e al t h of N at i on s
excise and customs in particular has been continually i c eas , n r
ing — ah equally clear proof o f an increasing c onsumption a d n
,

consequently o f an increasing produce whi h could alone sup c

port that consumption Great Britain seems to support with

.

ease a burden whi h half a century ago nobody believed h

c , , er
capable o f supporting Let us not ho w e up o. this account ,
v er , . n

rashly conclude that she is apable of supporting any burden c

,

n o r even be too confident that she could support without grea t

,

distress a burden a little greater than what has already bee

, n
laid upon her .

When national debts have once been ac cumulated to a e c r

tain degree there is scarce I believe a single instance of thei r
, , ,

having been fairly and completely paid The liberation o f t he .

public revenue if it has ever been brought about at all has

,
-

always been brought about by a bankrupt y ; sometimes by a c n

avowed one but always by a real one though frequently by a

, , .

pretended payment .

The raising of the denomination of the c oin has been t he

most usual expedient by which a real publi bankruptcy has c

been disguised under the appearan e of a pretended payment c .

If a sixpence for example should either by a t Of parliamen t

, ,
c

o r royal pro lamation be raised to the denomination o f a

c

shilling and twenty sixpen es to that of a pound sterling t he

,
c
,

person who under the Old denomination had borrowed twenty

shillings o near four ounces of silver would under the ew
,
r , ,
n ,

pay with twenty sixpences or with something less than t w o ,

oun es A national debt f about a hundred and twenty eight

c . o -

millions nearly the apital o f the funded and unfunded debt o f

,
c

Great Britain might in this manner be paid with about six ty

,

four millions of our present money It would indeed be a .

pretended paym ent only and the creditors o f the public woul d
,

really be defrauded o f t e hillig in the pound o f what w a '

n s n s s

due t o them The calamity too would extend much furthe r

.
, ,

than to the creditors of the public and those of every privat e ,

person would su ffer a proportionable loss and this without y an

advanta ge but in most cases with a great additional loss to t h

, ,
e

creditors o f the public If the creditors Of the public indeed

.
, ,

were generally much in debt to other people they might i ,

n

some measure compensate their loss by paying their creditors

in the same coin in which the public had paid them But in .

most countries the creditors of the public are the greater par t ,

of them wealthy people who stand more in the relation of

, ,

creditors than in that o f debtors towards the rest o f their fellow

 P u bli c D e b t s 4 3 1

c itizens A pretended payment o f this kind therefore instead

.
, ,

o f alleviating a ggravates in most cas es the loss of the creditors

,

o f the public and without any advantage to the public extends

, ,

the calami t y to a great number o f other inno c ent people It .

o ccasions a general and most pernicious subversion O f the for

tunes of private people enriching in most cas es the idle and ,

profuse debtor at the expense f the industr ious and frugal o

c reditor and transporting a great part Of the national capita l

,

from the b an d which were likely to increase and improve it to

s

t hose whi h are l ikely to dissipate and destroy it

c When it .

be c omes necessary fo a stat e to declare itself bankrupt in the

r ,

s ame manner as when it be omes necessary for an in dividual c

to do so a fair open and avowed ban kruptcy is always the

, , ,

m easure which i s both least dishonourable to the debtor and

least hurtful to the reditor The honour of a state is surelyc .

y provided for when in order t o cover the disgra e

'
”
v ry o o l
e r c
p ,

o f a real bankruptcy it has recourse to a juggling trick o f this

,

kind so easily seen through and at the same time so extremely

, ,

pernicious .

Almost all states however an ient as well as moder when

, ,
c n,

reduced to this necessity have upon some o asions played ,

cc ,

this very juggling trick The Ro mans at the end of the first .
,

Punic war reduced the As the oin or denom ination by whi h

, ,
c c

t hey omputed the value f all their other oins from contain
c o c ,

in
g twelve oun es of copper to contain o
c nl y t w ounces that o ,

is they raised two oun c es

, f opper to a denomination whi ch O c

had always before expressed the value of twelve oun es The c .

republic was in this man er enabled to pay the great debts

, n ,

w hih it had contracted with the sixth part o f what t re a lly

c i

o wed S O sudden and so great a bankruptcy we should i the

. n
,

present times be apt to imagine must have oc c asioned a very ,

violent popular lamour It does not appear to have o casioned

c . c
an y The law which enacted it was like all other laws relating
.
,

to the coin introdu ed and carried through the assembly of the

, c

people by a tribune and w probably a very popular law In ,

as .

Rome as in all the other an ient republi s the poor people were
, c c ,

constantly i debt to the ri h and the great who in order to

n c , ,

secure their votes at the annual elections used t lend them ,

o

money at exorbitant interest whi h being never paid soon ,

c , ,

ac umulated into a sum t great either fo the debtor to p ay

c oo r ,

or for anybody else to pay fo him The debtor for fear f a r .

,
o

very severe exe ution was obliged without any further gratuity
c , , ,

to vote fo the ca didate whom the creditor recommended In

r n .
4 1
4 T he W e al t h o f N at i o n s
S pite of all the laws against bribery and corruption the bounty ,

o f the candidates together with the occasional distributions of

,

corn which were ordered by the senate were the principal ,

funds from which duri g the latter times Of the Roman e

,
n r

public the poorer citizens derived their subsistence To delive

, . r

themselves f o m this subje tion to their creditors the poore

i c ,
r

citizens were ontinually calling o ut either for an entire abolition

c

o f debts or for what they called N ew Tables

,
that is for a , ,

law whi c h should entitle them to a complete acquittance upon

paying only a certain proportion o f their accumulated debts .

The law which reduced the coin o f all denominations to a sixth par t
o f its former value as it enabled them to pay their debts with
,

a sixth part of what they really owed was equivalent to the ,

most advantageous new tables In order to satisfy the people .

,

the ri h and the great were upon several different occas ions
c , ,

obliged to consent to laws both for abolishing debts and for ,

introducing new tables ; and they probably were induced t o

consent to this law partly for the same reason and partly that , ,

by liberating the public revenue they might restore vigour t o ,

that government f which they themselves had the prin ipal

o c

direction An Operation o f this kind would at once reduce a

.

debt o f a hundred and twenty eight millions to twenty e - -

on

millions three hundred and thirty three thousand three hundred -

and thirty three pounds S ix shillings and eightpence In t he

-

c ourse f the second Punic war the As was still further reduced
o ,

first from two ounces of copper to one ounce and afterwards

, ,

from o ounce to half an ounce ; that is to the twenty fourth

ne ,
-

part o f its original value By combining the three Roman .

operations into one a debt o f a hundred and twenty eight

,
-

millions of our present money might in this manner be reduced

all at once to a debt of five millions three hundred and thirty
three thousand three hundred and thirty three pounds six -

shillings and eightpence Even the enormous debt o f Great .

Britain might i this manner soon be paidn .

By means f su c h expedients the coin o f I believe all nation s

o , ,

has been gradually reduced more and more below its original
value and the same nominal sum has been gradually brought
,

to contain a smaller and a smaller quantity o f silver .

N ations have sometimes for the same purpose adulterated , ,

the standard of their coin ; that is have mixed a greater quan ,

tity f alloy in it If in the pound weight o f ur silver coin

o . o ,

for example instead of eighteen pennyweight according to the

, ,

present standard there was mixed eight oun c es o f alloy a

, ,
 P u bli c D e b t s 4 5 1

pound sterlin g o twen t y shillings o f such coin would be worth

,
r ,

li t tle more than six shillings and eightpen c e f our present o

money The quantity o f silver onta i ed

. x shilli gs
i d c n in S n an

eightp ence of our present money would thus be raised very

nearly to the denomination f a pound sterli g The adultera o n .

tion o f the standard has exa tly the same e ffe c t with what the c

French call an augmenta tion or a direct raising Of the de ,

nomin ation f the coin O .

An augmentation o r a direct raising o f the denomination f ,

o

the oin always is and fro m its nature must be an open and
c , , ,

avowed Operation By means of it pieces of a smaller weight .

and bulk are called by the same name which had before been
given to pieces f a greater weight and bulk The adulteration o .

o f the sta ndard o the contrary has generally been a conce a led
,
n ,

Operation By means o f t pieces were issued from the mint of

. i

the same denominations and as nearly as could be contrived , , ,

o f the same weight bulk and appearance with pieces which had , ,

been current before of mu h greater value When King John Of c .

France in order to pay his debts adulterated his oin all the
,
1
,
c ,

o fli ce of his mint were sworn to secrecy Both Operations are

rs .

unjust But a simple augmentation is an injustice of Open

.

violence whereas an adulteration is an injustice of treacherous

,

fraud This latter Operation therefore as soon as it has been

.
, ,

discovered and it could never be conce aled very long has always
, ,

excited much greater indignation than the former The coin .

after any considerable au gmentation has very seldom been

brought ba k to its former weight ; but after the greatest
c

adulterations it has almost always been brought back to its

former fineness It has s arce ever happened that the fury and
. c

indignation of the people could otherwise be appeased .

In the end of the reign o f Henry VIII and in the beginning .

o f that of Edward VI the English coin was not only raised in .

its denomination but adulterated in its standard The like ,

.

frauds were practised in Scotland duri g the mi ori t y f James n n o

VI They have o as ionally been practised in most other

. cc

countries .

That the publi c revenue f Great Britain can never be com o

p l e t ely liberated even that any considerable pro gress

, an or c

ever be made towards that liberation while the surplus Of that ,

revenue or what is over and above defraying the annual ex

,

pense f the peace establishment is so ve y small it seems

o , r ,

altogether in vain to expe t That liberation it is evident can c , ,

1
S D C g Gl
ee y v
u M t ; th B an di t i
e dit i os s ar ,
o ce one a e en e c ne e on .
4 6 1 Th e
W e al t h of N at i o n s
never be brought about w i thout either some very cons i derabl e
augmentation f the public revenue some equally considerabl e
o ,
or

reduction o f the public expense .

A more equal land tax a more equal tax upon the rent o f
-

houses and such alterations in the present system o f customs

,

and excise as those which have been mentioned in the fore

going chapter might perhaps without increasing the burden
, ,

o f the greater part o f the people but only distributing the ,

weight o f it more equally upon the whole produce a considerabl e ,

augm entation o f revenue The most sanguine projector ho w .

,

ever could scarce flatter himself that any augmentation of this

,

kind would be such as could give any reasonable hopes either

of liberating the public revenue altogether o even o f making ,
r

such progress towards that liberation in time o f peace as either

to prevent to compensate the further accumulation o f the
or

public debt in the next w ar .

By extending the British system o f taxation to all the

different provinces o f the empire inhabited by people of either
British o European extraction a much greater augmentation
r ,

o f revenue might be expe ted This however could scarce c .

, , ,

perhaps be done consistently with the principles o f the British

, ,

c onstitution without admitting into the British parliament o r

, ,

if yo u will into the states general o f the British empire a fair -

and equal representation o f all those different provinces that ,

o f each province bearing the same proportion to the produce o f

its taxes as the representation o f Great Britain might bea r to
the produce of the taxes levied upon Great Britain The private .

interest of many powerful individuals the confirmed prejudices ,

o f great bodies o f people seem indeed at present to oppose to so , , ,

great a change such obstacles as it may be very difficult perhaps ,

altogether impossible to surmount Without however pre

,
.
, ,

tending to determine whether such a union be practicable o r

impracticable it may o t perhaps be improper in a specula
,
n , , ,

t ive work o f this kind to consider ho w far the British system o f

,

taxation might be applicable to all the different provinces Of the

empire what revenue might be expected from it if 5 0 applied
, ,

a d in what manner a general union o f this kind might be likely

n

t o affect the happiness and prosperity o f the di fferent provinces

comprehended within it Such a speculation can at worst be .

regarded but as a new Utopia less amusing certainly but not , ,

more useless and chimerical than the old one .

The land tax the stamp duties and the di fferent duti es of
-

,
-

,
 P u bli c D e b t s 4 7 1

customs and exc ise constitute the four prin ci pal branches o f
the British taxes .

I ela d i certai
r nnly as able an d o ur American and West
5 ,

Indian planta tions more able to pay a land tax than Grea t
,

Britain Wh ere the landlord is subject neither to tythe nor

.

poor rate he must certainly be more able to pay such a t ax

-

than where he is subject to both those other burdens The .

tyt he where there is no modus an d where it is levied in kin d

, , ,

diminishes more what would otherwise be the rent o f the l and

lord than a land tax which really amounted to five shill ings in
-

the pound Such a tyt he will be found in most cases to amount

”

to more than a fourth part o f the real rent o f the land o r f ,

o

what remains after replacing completely the capital o f the

farmer together with his reasonable profit If all mo duses and
,
.

all impropriations were taken away the complete church tythe ,

o f Great Britain and Ireland could o t well be estimated at less n

than six or seven millions If there was no tythe either in Grea t .

Britain o r Ireland the lan dlords could afford to pay six o r seven
,

millions additional land tax without being more burdened than -

a very great part of them are at present America pays no .

tythe and could therefore very well aff ord to pay a land t ax
,
-
.

The lands in America and the West Indies indeed are in general , ,

not tenanted nor leased ut to farmers They could o t there o . n

fore be assessed according to any rent roll But neither were -

.

the lands o f Great Brita in in the 4 t h f William and Mary ,

o ,

assessed according to any rent roll but accord ing to a very -

loose d inaccurate estimation The lands in America might

an .

b e§ as essed either in the same manner or ac ordin g to an

s ,
c

equitable valuation in consequence o f an accurate survey like

that which was lat ely made in the Milanese and in the dom inions ,

o f Austria Prussia and Sardinia , ,

.

Stamp duties it is evident might be levied without any

-

, ,

variation in all countries where the forms Of law process and ,

the deeds by which prope ty both real and personal is trans r

ferred are the same or nearly the same

,
.

The extension of the custom house laws o f Great Brita in to -

Ireland and the plantations provided it was ac ompanied as ,

c ,

in justice it ought to be with an extension Of the freedom o f ,

trade would be in the highest degree advantageous to bo th

, .

All the invidious restrai nts which at present Oppress the trade
o f Ireland the distinction between the enumerated and n o
,
n

enumerated commodities of America would be entirely at an ,

end The countries north of Cape Finisterre would be as open

02
4 81 The
W ea l t h of N at i o n s
to every part f the produce of Ameri ca those south Of that
o as

Cape are to some parts o f that produce at present The trade .

between all the different parts o f the British empire would in ,

consequence o f this uniformity in the custom house laws be as -

free as the coasting trade o f Great Britain is at present The .

British empire would thus afford within itself an immense

internal market for every part o f the produce o f all its different
provinces So great an extension o f market would soon com
.

pensate both t o Ireland and the planta tions all that they cou l d
su ffer from the increase o f the duties of customs .

The excise is the only part o f the British system Of taxation

which would require to be varied in any respect according as it
w as applied to the di fferent provinces f the empire It might o .

be applied to Ireland without any variation the produce and ,

consumption o f that kingdom being exa tly o f the same nature c

with those o f Great Britain In its application to America and

.

the West Indies o f which the produ e and consumption are so

,
c

very different from those of Great Britain some modifi ation ,

c

might be necessary in the same manner as in its application to

the cyder and beer counties f England o .

A fermented liquor for example which is called beer but

, , ,

whic h as it is made of molasses bears very little resemblance

, ,

to o u beer makes a considerable part o f the common drink o f

r ,

the people in Ameri c a This liquor as it can be kept only fo ,

r

a few days annot like o u beer be prepared and stored up

,
c ,
r ,

for sale in great breweries ; but every private family must brew
it fo their o w n use in the same manner as they cook their
r ,

victuals But to subject every private family to the odious

.

visits and examination of the tax gatherers in the same manner -

as w e subject the keepers o f alehouses and the brewers for

publi sale would be altogether inconsistent with liberty If
c ,
.

for the sake o f equality it was thought necessary to lay a tax

upon this liquor it might be taxed by taxing the material o f
,

which it is made either at the place of manufacture o if the

, ,
r,

circumsta nces o f the trade rendered such an excise improper ,

by laying a duty u pon its importation into the colony in whi h c

it was to be c onsumed Besides the duty o f o e penny a gallon

. n

imposed by the British parliament upon the importation o f

molasses nto America there is a provincial tax Of this kind
i

mp o t t i iinto M assac husetts Bay in ships b e

,

u pon their i r a or ,

longing to any other colony f eightpence the hogshead ; and ,

o

another upon their importation from the northern colonies into ,

South Carolina of fiv ep e c e the gallon O r if neither o f thes e

,
n .
 P u bli c D e b t s 4 19

methods was found convenient ea ch family might compound ,

for it s consumption Of this liquor either according to the number ,

o f persons of which it consisted in the same manner as private

.

families compound for the malt tax in England ; o r according -

to the different ages and sexes o f those persons in the same ,

manner as several different ta xes are levied in Holland ; o r

nearly as Sir Matthew Decker proposes that all ta xes upon c o n

sumable commodities should be levied in England This mode .

o f taxation it has already been Observed when applied to

, ,

Objects Of a speedy onsu mption is not a very convenient ne

c o .

It might be adopted however in ases where no better could

, ,
c

be done .

Sugar rum and tobacco are ommodities which are nowhere

, ,
c

ne essaries o f life which are become objects o f almost universal

c ,

c onsumption and which are therefore extremely proper subje ts

,
c

o f taxation . If a union with the olonies were to take place c ,

those commodities might be ta xed either before they go out o f

-

the hands of the manufa turer o r grower or if this mode of c ,

taxation did not suit the circumsta nces o f those persons they ,

might be deposited in public warehouses both at the place f o

manufacture and at all the different ports of the empire to

,

which they might afterwards be transported to remain there , ,

u nder the joint custody f the owner and the revenue o fficer till
o ,

such t ime as they should be delivered o ut either to the consumer ,

to the merchant retailer fo r home consumption o r to the mer ,

c hant exporter the tax not to be advanced till such delive y

,
r .

When delivered out for exportation to go duty free upon prope r ,

s ecurity being given that they S hould really be exported o ut o f

the empire These are perhaps the prin ipal commodities with
. c

regard to whi h a union with the o lO ie might require some

c c n s

considerable change in the present system of British taxation .

What might be the amount o f the revenue which this system

o f taxation extended to all the di fferent provin es o f the empire c

might produ e it must no doubt be altogether impossible to

c , , ,

ascertain with tolerable exactness By means of this system .

there is annually levied in Great Britain upon less than e ight ,

millions o f people more than ten millions of revenue Ireland

, .

c onta ins more than t w millions o f people and according to the

o ,

a c counts laid before the congress the twelve asso iat ed pro ,
c

vinces f America contain more than three Those accounts

o .
,

however may have been exaggerated in order perha ps either

, , , ,

to encourage their o w people o to intimidate those o f this

n ,
r

c ountry and we S hall suppose therefore that our N orth A meri an

, c
, ,
4 2 0 T he W eal t h of N a t i o n s
and West Indian colonies taken together contain no more than
three millions or that the whole British empire in Europe a d
: , n

Ameri a ontains no more than thirteen millions of i mb abi

c ,
c

tants If upon less than eight millions of inhabitants thi s

.

system o f taxation raises a revenue o f more than ten million s

sterling it ought upon thirteen millions of inhabita nts to rais e
,

a revenue o f more than sixteen millions t w o hundred and fifty

thousand pounds sterling From this revenue supposing that .
,

this system could produce it must be deducted the revenu e ,

usually raised in Ireland and the plantations fo r defraying t he

expense f their respective c ivil governments The expense o f
o .

the civil and military establishment o f Ireland together with ,

the interest o f the public debt amounts at a medium o f t he , ,

two years whi h ended M ar h 775 to something less than seven

c c 1 ,

hundred and fifty thousand pounds a year By a very exac t .

account o f the revenue Of the principal colonies o f America and

the West Indies it amounted before the commencement o f t he
, ,

present disturbances to a hundred and forty o e thousand

,
-

eight hundred pounds In this a ount however the revenu e

. cc , ,

o f M aryland f N orth Carolina and Of all our late acquisition s

,
o ,

both upon the continent and in the islands is omitted which ,

may perhaps make a difference o f thirty o r forty thousand

pounds For the sake o f even numbers therefore let us sup
.
, ,

pose that the revenue necessary for supporting the civil govern
ment o f Ireland and the plantations may amount to a million .

There would remain consequently a revenue of fifteen millions

t wo hundred and fifty thousand pounds to be applied toward s
defraying the general expense o f the empire and towards paying ,

the public debt But if from the present revenue of Great

.

Britain a million could in peaceable times be spared towards

the payment o f that debt six millions two hundred and fifty ,

thousand pounds could very well be spared from this improved

revenue This great sinking fund t o o might be augmented
.
, ,

every year by the interest o f the debt which had been dis
charged the year before and might in this man ner increase so
,

very rapidly as to be su fficient in a few years to discharge the

whole debt and thus to restore completely the at present de
,

bi t a t ed and languishing vigour o f the empire

li In the mean .

time the people might be relieved from some of the most

burdensome taxes ; from those whic h are imposed either upon
the necessaries o f life o upon the materials of manufacture
,
r .

The labouring poor would thus be enabled to live better to ,

work cheaper and to send their goods cheaper to market The

,
.
 P u bli c D e b t s 4 2 1

c heapness of their goods would in rease the demand for them c ,

an d onsequently for the labour of those who produ ed them

c c .

Thi s in rease in the de m and for labour would both in rease the
c c

numbers and improve the irc umstances of the labouring poor c .

Their ons umption would in rease and together with it the

c c ,

revenue arising from all those articles Of their onsumption c

u pon which the taxes m ight be allowed to re m ain .

The revenue arising from this system o f taxation howe er ,

v ,

m ight not i mmediately increas e in proportion to the nu mber

o f people w ho were subjected to it Great indulgence would for .

s ome time be due to those provinces of the empire whi h were c

t hus subjected to burthens t o whih they had not before been c

a ccusto med and even when the same taxes came to be levied
,

e verywhere as exactly as possible they would not everyw here ,

produce a revenue proportioned to the numbers f the people o .

In a poor ountry the consumption of the prin ip al comm o dities

c c

s ubject to the duties of customs and exc se is ver small and i y

,

i n a t hi nly in habited count y the opportunities f smuggling r o

ar e very great The onsumption f malt liquors among the

. c o

in ferior rank s of people in S c otland is very small d the excise ,

an

upon malt beer and ale produces less there than in England
, ,

i n proportion to the numbers f the peopl e and the rate f the o o

duties whi c h upon malt 5 different on account f a supposed

,
1 o

d ifference of quality In these particular branches of the ex c ise

.

t here i s not I apprehend mu h more s muggl i

,
. ng i the o e ,
c n n

c ountry than in the other The duties upon the distillery and .
,

the greater part o f the duties o f customs in proportion to the ,

num b ers f people in the respe tive countries produce less in

o c ,

S cotland than in England not only account of the smaller ,

on

c onsumption f the taxed ommodities but Of the much greater

o c ,

facility f s muggli g In Ireland the inferior ra ks of people

o n . n

ar e still poorer than i n S otland and many parts f the country

c ,
o

ar e almost as thi nl y inhabited In Irela d t herefore the . n , ,

con

s umption f the taxed commodities might i

o n proportion to ,

the number f the people be still less than i S otla d an d the

o ,
n c n ,

facility f smuggli g nearly the same In America and the

o n .

West Indies the white people even Of the lowest rank are in much
better circumstances than those f the same rank in Englan d o ,

a n d their consumption o f all the luxuries i which they usually n

in dulge themselves is probabl y much greater The blacks .

,

in deed w ho make the reater part f the inhabitants bo th o f

g o

t he mi
,

colonies upon the continent and f the West India

.

s t he rn o
is lands as they are in a sta te o f slavery are no doubt i
,
n a wors e , , ,
4 22 W ea l t h of The
N at i o n s

condition than the poorest people either in Scotl and or Ireland .

We must t however upon that account imagine that they

no , , ,

are worse fed o that their consumption o f articles which might

,
r

be subje ted to moderate duties is less than that even o f t he

c

lower ranks of people in E gland In order that they may n .

work well it is the interest f their master that they should b

,
o e

fed well and kept in good heart in the same manner as it is

his interest that his working cattle should be The blacks
accordingly have almost everywhere their allowan ce of rum and
o f molasses spruce beer in the same manner as the white
or

servants and this allowan e would not probably be withdrawn

,
c

though those arti c les should be subjected to moderate duties .

The consu mption o f the taxed ommodities therefore in pro c , ,

portion to the number f inhabitants would probably be s o ,

a

great in America and t h e West Indies as in any part of the

British empire The opportunities o f smuggling indeed would
.
, ,

be much greater America i proportion to the extent of t he

, ,
n

country being much more thinly inhabited than either S otlan d

,
c

o Ireland If the revenue however which is at present raise d

r .
, ,

by the di fferent duties upon malt and malt liquors were t o

be levied by a single duty upon malt the opportunity of ,

smuggli g in the most important branch of the ex ise would b e

n c

al most entirely taken away : an d if the duties o f ustoms instead c ,

of being imposed U pon almost all the di fferent articles of im

p o rt at i
o were
n, confined to a few of the most general use and
consumption and if the l evyin g o f those duties were subje te d
,
c

to the excise laws the opportunity of smuggling though o t

, ,
n so

entirely taken away would be very much diminished In o n

,
. c

sequence o f those two apparently very simple and easy altera

, ,

tions the duties of customs and excise might probably produ c e

,

a revenue as great in proportion to the consumption f the mos t o

thinly inhabited province as they do at present in proportio n

to that f the most populous

o .

The A mericans it has been said indeed have n o gold o silve r

, , ,
r

money ; the interior commer e f the country being carried c o on

by a paper currency and the gold and silver which occasionally

,

come among them being all sent to Great Britain i return for n

the commodities wh ch they receive from us But without gold

i .

and silver it is added there is no possibility f paying ta xes

, ,
o .

We already get all the gold and silver which they have How .

is it possible to draw from them what they have not ?

The present scarcity o f gold and silver money in Ameri a is c

not the effect o f the poverty of that country o o f the inability ,

r
 P u bli c D e b t s 4 2
3
Of the people there to purchase those metals In a country .

where the wages of labour are so much higher and the pri e o f ,
c

provisions so much lower than i England the greater part Of n ,

the people must surely have wherewithal to purchase a greater

quantity if it were ei t her necessary o r convenient for them to
do so The scarc ity f those metals therefore must be the
. o , ,

e ffect of choice and not o f necessity

,
.

It is for transacting either domestic o r foreign business that

gold and silver money is either ne essa y onvenient
.

c r or c .

The domestic business o f every country it has been shown i ,

n

the se c ond book of this Inquiry may at least i peaceable times , ,

n ,

be transacted by means of a paper urrenc y with nearly the c

same degree o f convenien y as by gold and silver money It c .

is convenient for the Americans w ho c ould always employ with ,

profit in the improvement of their lands a greater stock than

they can easily get to save as much as possible the expense Of
,

so costly an instrument f commerce as gold and silver and o ,

rather to employ that part f their surplus produ e which would o c

be necessary for pur hasing those metals in purchasing the c

instruments of trade the materials of lothing several parts of

,
c ,

household furniture and the ironwork necessary fo r building

,
an d extending their settlements and plantations ; in purchasing ,

not dead stock but active and productive stock The colony
,
.

governments find it for their interest to supply the people with

such a quantity of paper money as is fully su fficient and generall y
-

more than suffi c ient f transac ting their domestic business or .

Some o f those governments that o f Pennsylvania particularly , ,

derive a revenue from lending this paper mone y to their subje ts -

at an interest o f so mu h per ent O thers like that of Massa c c .

,

c hu et t s Bay advance upon extraordinary emergen c ies a paper

’
s ,

money f this kind for defraying the public expense and after
o ,
‘

wards when it suits the conveniency of the c olony redeem it

, ,

at the depreciat ed Value to whi h it gradually falls In c .

that colony paid in this manner the greater part of its publi
, ,
c

debts with the tenth part of the money f whi h its bills had or c

been granted It suits the convenien y f the planters to save

. c o

the expense of employing gold and silver money i their domestic n

transactions and it suits the conveniency of the colony govem

,

ments to supply them with a medium which though attended ,

with some very onsiderable disadvantages enables them to

c ,
'

save that expense The redundancy of paper money c e .

-

ne s

sari ly banishes gold and silver from the domestic transactions

1
S H t hi
ee u cHit y f M
n so n sh
’
tt B y l ii p g 4 36 t
s or q o as s ac us e
’
s a ,
vo . . a e , e se .
 2
4 4 Th e W e al t h of N at i o n s
of the colonies for the same reas on that it has banished those
,

metals from the greater part f the domestic transactions in o

Scotland ; and in both countries it is not the poverty but the ,

enterprisin g and projecting spirit o f the people their des ire Of ,

e mployin g all the stock which t hey can get as active and pro
v e stock which has occasioned this redundancy
d uc t i ,
f paper o

money .

In the exterior commerce whi h the different colonies carry c

o n with Great Britain gold and ilver are more less employed ,
S or

exactly in proportion as they are more o less necessary Where r .

those metals are not ne c essary they seldom appear Where .

they are necessary they are generally found .

In the commerce between Great Brita in and the tobacco

colonies the British g oods a e generally advanced to the colonists r

at a prett y long cred it and are afterwards paid fo r in tobacco , ,

rated at a certa n price It is more convenient for the colonists

i .

to pay in toba co than in gold and s ilver It would be more

c .

convenient fo any merchant to pay fo the goods which his

r r

correspondents had sold to him in some other sort f goods o

which he might happen to deal in than in money Such a .

mer hant would have no occas ion to keep any part of his stock
c

by him unemployed and in ready money for answering occa , ,

sio al demands
n He could have at all times a larger quantity
.
, ,

of goods in h is hOp o r warehouse and he could deal t o a greater

s ,

extent But it seldom happens to be convenient for all the

.

co rrespondents o f a merchant t receive payment fo the goo ds o r

whi h they sell t o him in goods f some other kind which he

c o

happens to deal in The British mer hants who trade t o . c

Virgin ia and Maryland happen to be a particular set o f corre

sp o d e t
n to whom it is more convenient to receive payment
n s,

for the goods which they sell to those c olonies in tobacco than
in gold and silver They expect to make a profit by the sale
.

of the tobac o They could make none by that o f the gold and
c .

silver Gold and silver therefore very seldom appear in the

.
, ,

commer e between Great Bri t a in and the tobacco colonies

c .

M aryland and Virginia have as little occasion for those metals

in their foreign as in their domestic ommerce They are said c .
,

accordingly to have less gold and silver money than any other
,

c olonies i America They are reckoned however as thriving

n .
, , ,

and consequently as rich as any o f their neighbours ,

.

In the northern colonies Pennsylvania New York N ew , , ,

Jersey the four governments f N ew England etc the value

, o ,
.
,

o f their o w produce which they export to Great Bri t ain is o t

n n
 P ubli c D e b t s 4 5
2

e qual to that o f the manufactures which they import for their

ow use and for that f some Of the other colonies to whi c h
n ,
o

they are the carriers A balan e therefore must be paid to . c , ,

t he mother country in gold and silver and t hi s balanc e they ,

generally find .

In the sugar colonies the value f the produ e annually exported o c

t o Great Brita in is mu h greater than that o f all the goods i m c

p orted from then e If the sugar and rum annually sent to

c .

the mother country were paid for in those colonies Great Brita in ,

would be obliged to send o ut every year a very large balance

in money and the trade to the West Indies would by a certain
,
‘
,

s pecies o f politi ians b o nsidered as extremely d i

c s d an
,
e c a v

t ageo u But it so happens that many f the principal pro

s . o

rit o s o f the sugar pl ntations reside in Great Brita in Their

p e r a .

rents are remitted to them in sugar and um the produ e of r ,

c

their estat es The sugar and rum whi c h the West India
.

merchants purc hase in those colonies upon their o w ac ount n c

a e not equa l in value to the goods whi c h they annually sell

r

there A balanc e therefore must ne essarily be paid to them

.
, ,
c

in gold and silver and this balance t o o is generally found, , ,

.

The d iflic ult y and irregularity o f payment from the d ifl e t ren

c olonies to Great Britain have not been at all in proportion to

the greatn ess r smallness of the balan es whi h were respe tively
o c c c

d ue from them Payments have in general been more regular

.

from t he northern than from the tobacco colonies though the ,

former have generally paid a pretty large balan e in money c ,

while the latter have either p aid no balan e r a much smaller c ,

o

o ne The d iflic ult y o f getting payment from o u diff erent sugar

. r

c oloni es has been greater o less in proportion o t so much to r ,

n

t he extent o f the balan es respectively due from the m as to c ,

the quan tity o f uncultivated land which they conta ined ; that
is to the greater o r smaller temptation which the planters have
,

been under o f overtradin g o o f undertaking the settlement ,

r

an d plantation f greater quantities o f waste land t han suited

o

the extent o f their capitals The returns from the great island .

o f Jamaica where there is still mu h un ultivated land have

,
c c , ,

upon this a count been in general more irregular and uncertain

c ,

than those from the smaller islands of Barbadoes Antigua and , ,

St Christophers which have f these many years been com

.
,
or

p let ely ultivated and have upon that a ount a ff orded less
c
, ,
cc ,

field for the speculations of the planter The ew a quisitions . n c

o f Grenada Tob ago St Vin ents and Domini

,
ca have Opened ,
. c ,

3
. new field fo speculations f this kind and t he returns from
r o ,
 6 Th e
W eal t h of N at i o n s ‘

4 2

those islands have f l ate been as irregular and

o u n c er t a i
n a s

those from the great island o f Jamaica .

It is not therefore the poverty o f the colonies which oc asions

, ,
c ,

in the greater part o f them t he present s arcity o f gold and

,
c

silver money Their great demand for active and productive

.

stock makes it convenient for them to have as little dead stock

as possible and disposes them upon that account to content
,

themselves with a cheaper though less commodious instrument

o f commer c e than gold and silver They are thereby enabled .

to convert the value o f that gold and silver into the instruments
o f trade into the materials of lothing into household furniture
,
c , ,

and into the ironwork n ecessary for building and extending

their settlements and plantations In those branches o f business .

whi h cannot be transact ed without gold and silver money it

c ,

appears that they can always find the necessary quantity of

those metals ; and if they frequently do not find it their failure ,

is generally the e ffect not o f their necessary poverty but of their

, ,

unnecessary and excessive enterprise It is not because they .

are poor that their payments are irregular and uncertain but ,

because they are too eager to become excessively rich Though .

all that part o f the produce o f the colony taxes which was over
and above what was necessary for defraying the expense Of their
own ivil and military establishments were to be remitted t o
c

Great Britain in gold and silver the co l onies have abundantly ,

wherewithal to purchase the requisite quantity o f those meta ls .

They would in this case be obliged indeed t o exchange a part , ,

of their surplus produce with which they n o w purchase active

,

and productive stock for dead stock In transacting their

,
.

domestic business they would be obliged to employ a costly ‘

instead of a cheap instrument of c ommerce and the expense ,

o f pur hasing this costly instrument might damp somewha t

c

the vivacity and ardour o f their excessive enterprise in the '

improvement of land It might not however be necessary t o

.
, ,

remit any part of the American revenue in gold and silver I t .

-

might be remitted in bills drawn upon and ac cepted by particular

merchants or ompanies in Great Britain to whom a part of t he
c

surplus produce of America had been consigned who would pay ,

into the treasury the American revenue in money after having ,

themselves received the value o f it in goods ; and the whole

business might frequently be transacted without exporting a
single ounce of gold o silver from America r .

It is not contrary t o justice that both Ireland and America

should contribute towards the dis c harge Of the public debt Oi . .
 P u bli c D e b t s 4 2
7
Great Britain That debt has b een contracted in support f
. o

the government established by the Revolution a governmen t ,

t o whi ch the Protestants o f Ireland o w e not only the whol ,

e

authority which they at present enjoy in their o w country bu t n ,

every security which they possess for their liberty their propert y , ,

and their religion ; a government to which several o f the colonie s

o f A merica o w e their present charters and consequently their ,

present constitution and to whi h all the colonies o f America

,
c

o w e the liberty se urity and property which they have ever

,
c ,

S ince enjoyed That pub l ic debt has been contracted in t he

.

defence not of Great Britain alone but f all the differen t

, ,
o

provinces o f the empire ; the immense debt contracted in t he

late w r in parti ular and a great part of that contracted in t he
a c ,

war before were both properly contra ted in defence o f Am erica

,
c .

By a union with Great Britain Ireland would gain beside , ,

s

the freedom o f trade other advantages much more important , ,

and which would mu h more than compensate any in c rease ofc

taxes that might accompany that union By the union with .

England the middling an d inferior ranks of people i Scotlan d n

gained a complete deliverance from the power of an aristocracy

which had always before Oppressed them By a union with .

Great Britain the greater part f the people o f all ranks i o n

Ireland would gain an equally omplete deliverance from a mu h c c

more Oppressive aristo ra y ; an aristocracy not founded like c c ,

that f Scotland in the natural and respe table distin tions o f

o c c

b irth an d f rt u i
,

e but in the most odious of

o r ,
ll distinctions a ,

those o f religious and political prejudices ; distin tions whih c c ,

more than any other a imate both the insolen e Of the Oppressors
,
n c

and the hatred and indignation Of the Oppressed and whih ,

c

c ommonly render the inhabitants o f the same country more

hostil e to one another than those o f different ountries ever are c .

Without a union with Great Brita in the inhabitants o f Ireland

are not likely for ma y ages to onsider themselves as e n c on

people .

N o Oppressive aristocra y has ever prevailed in the c olonies c .

Even they however would in point of happiness and tran

, , ,

qu illity gain onsiderably by a un on with Great Britain I t

,
c i .

would at least deliver them from those ran c orous and virulen t
, ,

fa tions which are inseparable from small democra ies a d

c c ,
n

whic h have S O frequently divided the affe tions of their people c ,

and disturbed the tranquillity o f their governments i their ,

n

form so nearly demo ratical In the case of a total separation

c .

from Great Britain which unless prevent ed by a union of th is

, ,
 4 2 8 T he W eal t h of N at i o n s
kind seems very likely to take place those factions would be
, ,

t en times more virulent than ever Before the commen ement . c

o f the present disturbances the coercive power of the mother ,

c ountry had always been able to restrain those fa tions from c

b reaking out into anything worse than gross brutality and

insult If that coer ive power were entirely taken away they
. c ,

would probably soon break o u t into Open violen e and blood c

s hed In all great countries whi h are united under e un iform

. c on

government the spirit f party commonly prevails less in the

,
o

remote provinces than in the entre of the empire The dis c .

tance f those provinces from the capital from the principal

o ,

s eat of the great scramble o f faction and ambition makes them ,

e nter less into the views o f any f the contending parties and o ,

r enders them more indi fferent and impartial specta tors of the

c onduct o f all The spirit o f party prevails less in Scotland

.

t han in England In the ase of a union it would probably

. c

prevail less in Ireland than in Scotland and the colonies would ,

probably soon enjoy a degree Of con ord and unanimity at c

p resent unknown in any part o f the British empire Both Ire .

land and the colonies indeed wo uld be subjected to heavier , ,

t axes than any whi h they at present pay c In consequence .

,

h owever o f a diligent and faithful application o f the public

,

r evenue towards the discharge o f the national debt the greater ,

p art o f those taxes might not be of long continuan e and the c ,

p ublic revenue o f Great Britain might soon be reduced to what

w as necessary f maintaining a moderate pea e establishment
or c .

The territorial acquisitions o f the East India Compan y the ,

u ndoubted right of the crown that is f the state and people , ,

o

o f Great Britain might be rendered another source of revenue

,

m ore abundant perhaps than all those already mentioned

, ,
.

Those ountries are represented as more fertile more extensive

c , ,

a d in proportion to their extent much richer and more p Op u

n , ,

lous than Great Britain In order to draw a great revenue from

.

t hem it would not probably be necessary to introduce any

,

n ew system f taxation into countries which are already s uffi

o

c i e t ly and more than suffi iently taxed

n It might perhaps be c .
, ,

m ore proper to lighten than to aggravate the burden o f those

u nfortunate countries and to endeavour to draw a revenue
,

from them not by im po sing ew taxes but by preventing the

,
n ,

e mbezzlement and misapplication o f the greater part of those

which they already pay .

If it should be found impracticabl e for Great Britain to draw

a y considerable augmentation o f revenue from any of the
n
 P u bl i c D e b t s 4 2
9
resources above mentio ed the only resource which can remain n ,

to her is a diminution f her expense In the mode of ollect o . c

ing and in that o f expending the public revenue th ough in ,

both there may be still room f improvement Great Brita in or ,

seems to be at le t as e c onomical as any o f her neighbours

as .

The military establishm ent which she maintains for her own
defence in time o f peace is more moderate than that of any
European state which can pretend to rival her either in we lth a

or in power N one f those articles therefore seem to admi t

. o , ,

o f any onsiderable reduction o f expense

c The expense of t he .

peace establishment of the colonies was before the commence ,

ment o f the present disturbances very considerable and is a , ,

n

expense which may and if no revenue can be drawn from them

,

ought certainly to be saved altogether This c onstant expens e .

in time o f peace though very great is insignifi c ant in com

, ,

parison with what the defence Of the colonies has cost us in

time o f war The last wa which w as undertaken al togethe
. r, r

o n account o f the colonies c ost Great Britain it has already , ,

been observed upwards Of ninety millions The Spanish w a

,
. r

o f 739 was pr i
1 ncipally undertaken o n their a count in which c , ,

and in the French w a that was the consequence o f it Great r ,

Britain spent upwards o f forty millions a great part o f which ,

ought justly to be charged to the colonies In those t w o wars .

the colonies cost Great Britain much more than double the sum
whi h the national debt amounted to before the commencemen t
c

o f the first o f them Had it o t been for those wars that deb t
. n

might and probably would by this time have been completely

, ,

paid ; an d had it not been fo the olonies the former f thos e r c ,

o

wars might o t and the latter certainly would t have bee

n ,
no n

undertaken It was because the colonies were supposed to b e

.

provinces f the British empire that this expense was laid ut

o o ,

upon them But countries which contribute neither revenue

.

nor m ilitary force towards the support of the empire c nnot b e a

considered as provinces They may perhaps be considered . as .

appendages as a sort f splendid and showy equipage f t h

,
o o e

empire But if the empire can no longer support the expens

. e

o f keeping up this equipage it ought certainly to lay it down ; ,

an d if it cannot raise its revenue in proportion to its expense ,

it ought at least to accommodate its expense to its revenue I f

, ,
.

the colonies notwithstanding their refusal to submit to Britis h

,

taxes are still to be onsidered as provinces of the Britis h

, c

empire their defenc e in some future war may cost Great Britain
,
.

as great an expense as it ever has done in any former war .

430 The
W e al t h of N at i o n s
Th rulers of Great Br i tain have for more than a century past
e , ,

amused the people with the imaginat i on that they possessed a

great empire the west si
on d e of the Atlantic T h is empire .
,

however has hitherto existed in imagination only It has

, .

h itherto been o t an empire but the proj ect o f an empire ; not

,
n ,

a gold mine but the proj ect o f a gold mine ; a project which
,

h as cost which continues to cost and which if pursued in the

, , ,

s ame way as it has been hitherto is likely to cost immense

, ,

e xpense without being likely to bring any profit ; for the e ff ects
,

o f the monopoly o f the colony trade it has been shown are to

, , ,

t he great body of the people me re 105 5 instead of profit

,
It is .

s urely now time that our rulers should either realise this golden
d ream in which they have been i ndulging themselves perhaps
, , ,

a well as the people or that they should awake from it them

s ,

s elves and endeavour t o awaken the people If t he project

,
.

c annot be completed it ought to be given up If any of the

,
.

provinces of the British e mpire cannot be made to contribute

t owards the support of the whole empire it is surely time that ,

Great Britain should free herself from the expense o f defending

'

t hose provinces in time o f war, and of supporting any part of

t heir civil o military establishments in time o f peace and e
r ,
n

d eav o ur to accommodate her future views and designs to the

r eal mediocrity of her circumstances .
 A PPEND IX

THE t w o following accounts are subj o ined in order to illustrate

and confirm what is said in the Fifth Chapter f the Fourth o

Book concernin g the tonnage bount y to the White Herring

,
-

Fishery The reader I believe may depend upon the accuracy

.
, ,

o f both accounts .

AN A O U NT B U E F TTED
CC OF S O TLAND
SS S E LE VEN
I OU T IN C F OR

Y EAR W TH THE N U M ER
S, I E MPT B ARR ED
B OF Y A RRE L s C I O U T,

AND THE N U M ER B H ERR N

B AU HT ; AL O
OF A RR E L s OF I GS C G S

THE B O U NT AT A MED U M EA H B ARREL S

Y I ON C OF E A S TE E K S ,

AND EA H B A REL W HEN F LL PA ED

ON C R U Y CK

Em t p yB ar B arre s l i13
Y ear s l id
r e s c arr e o f H err n i g 2 3
11 5
s
511
2
1 On

ug h t
.
8
o ut . ca .

Total 0
5 5 94 3 378 34 7 1 5 5 4 63 H o
43 2 Th e W eal t h of N at i o n s
S ea st eek s 8
37 , 34 7 Bounty at a medium for each
barrel o f ea t eek £0 8 2 1
s s s

But a barrel o f a t eek s se s

being only reckoned t wo third s -

o f a barrel fully packed o e n

,

third is deducted whi h bring ,

c s

the bounty to £ 0 2 33 1 ;

5 deducted

Barrels full packed 3 5 2 1

A n d if the herrings are exported there is , ,

besides a premium f
,
o

So that the bounty paid by Government in

money for each barrel is £ 0 14 11 %
But if to this the duty o f the salt usually
taken credit for as expended in curing each
barrel which at a medium is f foreign o e
, o ,
n

bushel and one fourth Of a bushel at 0 a

-

,
1 5 .

bushel be added v i
, ,
z . 0 12 6

The bounty on each barrel would amount to £ 1 7 5

If the herrings are cured with British salt it will stand ,

thus viz ,
.

Bounty as before £ 0 14 11 g
But if to this bounty the duty on two
bushels o f Scots salt at 5 6d per bushel
1 . .
,

supposed to be the quantity at a medium used

in curing each barrel is added to wit ,

The bounty on each barrel will amount to £ 0 1 7 11 2

When buss herrings are entered for home consumption in

 A pp e n di x 4 33
S cotland ,and pay the shillin g a barrel o f duty the bounty ,

s tands thus t wit as before

,
o £ 0 31 12

From which the 5 a barrel is to be

1 .

d educted

0 H 31
But to that there is t o be added again the
d u t y o f the foreign salt used in curin g a barrel
o f herrings viz
,
. 0 12 6

that the premium allowed for each barrel

So
o f herrings entered for home consumption is £ 1 3 9%

I f the herrings are cured with British salt it will sta nd as ,

follows viz ,
.

Bounty o n each barrel brought in by the

b usses as above £ 0 12 35
From which deduct the a barrel paid at 15 .

the time they are entered for home con

s umption

£0 I I 3%
But if to the bounty the duty t wo on

bushels o f Scots salt at 6d per bushel I S . .

,

supposed to be the quantity at a medium

used in curing each barrel is added to wit , ,

The premium fo each barrel entered for

r

home consumption will be £ 0 14 32

Though the loss of duties upon herrings export ed cannot ,

perhaps properly be considered as bounty ; that upon herr ings
,

entered fo home consumption ce rta inly may

r .
4 34 Th e W eal t h of N at i o n s

AN A O U NT
CC QUANT T
OF TH E F O RE N S ALT MP O RTED NT
I Y OF IG I I O
S O TLAND AND
C S O T S ALT DEL VERED D T
OF C S F REE F R O M I U Y
THE W O R TH RE THE F FROM 5 TH APR L
,

KS E F OR I S H E RY , TH E OF I

177 THE 5 TH APR L 78 W TH A MED M

1 To OF I 1O TH 2, I IU OF B F OR

ON E Y EAR .

l
S co t s S a t de

tg
F ’ ’g
gé g
i g
lt
liv d f
er e ro m t he
c
WOk
P E RI O D
'
.

B us hl e s . B us hle s.

From the 5t h o f A pril 1 77 1

to the st h of April 1 78 2

Medium for one Year 8 551 1 799 1 3

1 1

It is to be observed that the Bushel of Foreign Salt weigh s

8 4 lb that of British Salt 5 6 lb only
.
,
. .
 IN DEX
Act fo r t he E n c o ur a g e m en t of pi l d i 37 ;di v y f
r ce o f an n, 1 sc o er o
d ii 3 4 i wh t w y i ihdE p
,

Tr a e n t a a enr c e ur o e,
A t f N vig t i 39 3;E gli h l i f
. .
,

c o a 1 4 07 4 08 a 9on, 11 2 n s f c o o n es o c a us e o
Af i t i l d v ig t i 1 9 ; th i pid p g
. .
, ,

r c a, i s n an na a on , 1 e r ra i i 69 7 3; ro r ess , -

i h bit t f di v y f ff t f t h i g t
. .

sc o er o ec s o s r ea
Af i C mp y l 5 — 8
n a an s o e
r c an o an
,

l 22 22 ev t en p ll t i 338
121 1 22
,
°
o ax n,
A gi f t h b k f Am t d m i ty f g ld lv
.
, , ,

o, o an s er a 3 9 i s c ar c d i o o an S er
e o
3 ;
; f b k f H mb g b t i t p bli
.
,

d b t f G t B it i 4 6—
2 93 4 , 21 o an o a ur ,
i n 4 , ; t i22 con r u on o u c

4 22 e o 4 7
r ea r a n, 2 2
Ag i l t
r cu t ur e, p t ibl f
no so s us c e e o Amt d m B k f i 9 3;4 ff ;
s er a an o 2 22
divi i f l b
.
, ,

s on o m f a o ur as an u a c
t ur es , 1 6 pit l p t °
th
ca a s en on e A it i m y b w—d p
nn u es , one o rr o e u on,
dv a t g it y by g v m t ii 39 8 4 00; l
.

m t
—os a t n a eo u s o so c e o ern en sa e
f t h g wt h
.
, ,

3 4 3 5 3 7;
2 2 2 c au s e o e ro of 40 1
O fw lt h i
— ea A m i
,

l
n o ur er c an c o o n Ap t h i t h i p fi t i 00
o
,

ec ar es , e r ro s, 1

3 7 3 8 ; di gm t f Appl d v g t bl i i g
.

i es , 2 2 s c o ur a e en o es an e e a es , n c r eas n
i n A i t E p 34 ff ; n c en ur o e, 1 ch p ea f i n es s 8t h t y
o n 1 c en ur
f ig mm d p d t
o re n co er c e e en en on, i 69
, ,

36 36 ;p fi t t f m m App t i mb f limi t d by
.

f
—
1 -
2 ro o ro an u a c r en c es , n u er o e
t ur es d mm an 3 66 37 0 ;
co er c e , l w ia 08 ;q i t k w t th
1 u e un n o n o e
f v d by t h l w f E gl d i t v b t h gh t
.
,

a o ur e e a o n an an c en s , 1 1 I ne er een ou

37 ;w l t h d iv d f m m y f h b dy
,

2 ea er e ro ore n ec es sar 4; or us an r 11
d bl t h t h t w hi h i f i l ti f l b
,

f m mm 37 3—374 ; i t
ro
ur a
co
e an
er c e,
a c ar s es
an c en t
r ee
s r uc e t d by —3
c rcu a b
1 22
on o
12
a o ur o

p li y f E p i g ii App t i h ip d t i ,

8—
o c o ur o e c o n c ern n r en c es f s, ur a on o as
g l l y fi x d by t t t
.
,

d 09—0
2 9 ; 2 i t t
a r cu m f t h ur a s s e o e e 08 09 ; i
s a u e, 1 1 -
1 n
F h p h il p h 5 8 66 ; F tl
.

r en c o so ers , 1 -
1 as r an c e d S an co an 1 11
°

ff t d by f by d t i l g it y g i t f d
,

t d
64—67 ; t f v
a ec e r ee ra e, o r u es , on no s ec ur a a ns r au
d by t h p li gm t t
i d t y 0— ; d
, ,

1 1 no a o ur e e o 11 0; d an no en c o ur a e en o
ti l
ca my f m d
ec o n o E p o o ern ur o e, n us r 11 111 an un n ec es

7 3; f v d by t h t f Ch i y ,

—
1 a o ur e a o n a, s ar 111

7 3 7 4 ; d f E gyp t d I d A i t t l hi t t h ip f Al x
,

— o an u o rs
1 1 an n o r s o e, s o e
ts an , 1 75 77 ; t g d by
1 no en c o ur a e an d m ifi t ly w d d
er un c en re ar e
mp i g i t p m i
,

i t
os n r es r a n s u on an u 1 22
f t d f ig t d 79 A my mp t iv x p
.

ac ur es an o re n ra e, 1 r co f i ar a e e en s e o n
l l 335 ivil iz d d iviliz d
,

i
,

8 0 ; ff t f th t i
ii 8 —8 5 ;
1 e ec on, o e a e, un c e an c e so c e

338 ;d p d t e pit l f l d
en en on c a a o an ti es , 1 2d ig 1 c a u ses r en er n
l d 4 09 4 0;t d d m x p iv 8 5 8 8 9 7 9 8 ;
.

or 1 ra e an an u w ar e en s e, 1 1 1 -
1
m th d f p vi d i g f p bli
-

f ti d p d t 40
, ,

8 8—8 9 ; fi t
ac ir e e en en on , 1 e o s O ro n or u c
Al v l t h f S p i ii 38
ca a a, e, o a n, 1 df e en c e , t 1 di g 1 rs s an n
p i f d p d t th t f my f w h i h d i xt t
.

Al e, r ce o e en en on a o ar o c r ec o r s e an
B l y 1 67 9 ; mi f C th g
,

ar e 68 ; M lt t
1 -
1 s ee a ax 1 2 ar 9 es o 9 3; ar a e, 1 2 -
1
Am i w g i t t d p fi t 9 3; l x t i
.
,

er c a , a es , n er es an ro s o f R m 9o e, 1 f 2 -
1 re a a on O
of t k i i 8 ; di v y f
s oc n 2 sc o er o di ipli sc i R m ne my n
94 ; o an ar 1
ilv mi i ff t p i f mili t y f G m
.
, ,

S er n es n, e ec on r ce o ar f th o r c es o e er an s
i
Slv 75 er , 83 84 ;i
1 t m k t 1 1 s ar e an d S yt hi 95 ;
c p i it y an s , 1 su er o r
th p d w mi di g m y v milit i
, ,

f fi t f t
8 5 —8 6 ;p p
or e ro uc e o s o n n es , o a s an n ar o er a a,
1 1 y i 87 a er c urr en c n, 2 95
1 9 6 ;j l y f m g
1 ea o u s o a on re
g i lt d t d p bli
, , ,

288 9 2 1
°
a r cu ur e an ra e u 96 97c an s , 1 1
pid p g p h ib it d f m l v i g
, ,

i 3 7
n 2 i ra ro r es s n A ti
r fi c er s , ro e ro ea n
N t h Am ior l i m
er c an c o o n es co th e t y i i 53
c o un r 54 ; 1 1 iin
p d t t h t f E p 370 p d t iv f th i lb
.
, ,

ar e o a o ur o e, ro uc en es s e r a o ur
°
o
 436 W eal t h of N at i o n s Th e
id d by t h F h ti f i 35 3 35 4 pp d by
6 —
as cons er e e r en c ons o ;s u ort e
p h il p h h Ki g g i h l d
.
, ,

63 o sop i er s , 35 5 1 0 1 ; ex os t e n a a n st t e or s,
i t f h f hi t t st at e
68—7
on o e err o r s o s
m dimi i h h C dl
en t , 1 35 5 1 2 ; to n s t e an es , t ax o n , 11
mb f d p h m C p i l w w y f mpl yi g i
.

nu h er o e r es s es t e o e a ta t o a s o e o n t,
m k i l i g d fix d
, ,

79 ar et 3 4 1 24 24 ;c rcu at n an e
iz f b d d l h i
, , , ,
A ss e o 45 6 8
r eah w i an a e, t e, 244 , 2 24 -
24 ; o c rc u
l i g pi l i pl i h d
.
,

63 1 67 1 at n ca ta s re en s e
8 w k q i i g pi l f
, ,

24 ; or s re u r n ca ta o
"

B ank f E gl d i i o fp p b h ki d 4 9 h i
n an i f ts ss u e o a er ot n s, 2 ;t e n t en t on o
y dg l i g fi x d pi l 5 x p
,

m f
r e a t an n u a ta
67—69 ; g
one an co n a e, e ca 2 2 ; e en s e o
b k f i m i t i i g fix d pi l 5
,

1 2 2 r ea t es t an o c r a n a n n e ca ta 2 2,
l i i E p 83 hi y 5 3; i l i g pi l f
.
,

c u at o n n ur o e, 2 ; stor 2 c rc u at n ca ta o a so
f 83 85 ; h
o i g ii 5
2 -
i diff f m h f i di
2 t e co n a e, 1 c et y er s ro t at o an n
l p fi f 99 d vid l 5 ; fi x d pi l d
.
,

5 ; 4 n et a n n u a ro t o 2 an ua 2 3 e ca ta an
h t f d d d b 39 4 i
e u n un m y h i im il fie
— h e t,
,

; n t er es t one
,

t e r s ar e ec t o n t e
dv m d by v i t y 5 3 5 7 ;p
,

on a a n c es a e 39 5 re f
en u e o so c e 2 2 ro
B an k p t y p bli h w g
ru c lly u c, o
,

en er a p ti b tw
or on d v e een ,
,

an re en u e,
di g i d ii 4 g l t p p ti b tw i
,

s u se 12 re u a es ro or on e een n
k d b ki g ( l d d idl
.
,

B an s an an n s ee a s o un er d t y
us r 30 ;
an f en ess , 1 c a us e o
M y) h w t h b i id i d di mi t i i 30
—
one o e u s n ess c arr e n c r ea s e an nu on n, 1
h 303; w h l t t i t t i
,

on, 57 60 ;
1 2 t 2 c as ac c o un s en en a n er es s
g t d by b i mp i q iv l t t t h ig m t f
.
,

r an e kig ai n co an es e u a en o e a ss n en o
i S n tl d 63; ch i f x p
co an 2 e e en s es a p ti f th
or on o lp d e an n u a ro uc e ,
f b k 66 ; ff t f i i g mp t i t i b tw
,

o an s, 2 e ec o ss u n 3 5 ; h w
1 o co e on e een
l g q t it y f p p pit l lt f
y 67—69 ; bill f
t oo ar e a u an o a er ca ia s 3 6; ar s es , 1 r es u o
m one 2 2 s o ex co mp t it i e 3 6; p p ti on 1 ro or on
h— g 69 ; dv y b tw vl d th t
, ,

c an fm
e, 2 a a n c es o on e e een f f
a ue o an a o

7 3;t h p ti f d wi g i t t 3 7 ; p p ti
, ,

269 2 e r ac ce O ra n n er es b 1 ro or on e
d w i g 74 7 8 ; f il pi t l p fit
,

an d re ra n 2 -
2 a ur e tw een d ca a an ro as
i d by t g t lib lit y ff t d by i i q t it y
,

dit 79—8 ;
o c c as o n e oo r ea er a a ec e n c rease n u an
i th g
n ti g f e r an n o cre 2 2 2 o f ilv s f mm d it i
er , o r o 3 7 co o es , 1
p ti d d t k 3 9 ;di ff t w y f m pl yi g
,

i t s O t er a ons ur n ea s oc 1 er en a s o e o n
i t p d t iv t k 8 5 8 6 ;
n o ro uc e s oc 2 -
2 3 21 f t ilo d wh l
re a l m er an o es a e er
pt i l l i t di t h t 3 3 3 4 3 5 fth m t
,

O on a c aus e n s er e n no es c an 2 2 2 o e a s er
i d by S t t i h b k 9 0 f t 3 4 3 5 3 6 ; pi
, , ,

ss u e co s an s, 2 m an u a c ur er , 2 2 2 ca

9 ; gi p mi m 9 3; f d i g i lt t h m t
, ,

2 1 a o, a re u 2 r ee t l a us e n a r cu ur e e os
mp t i t i i i dv t g dv t g i ty 3 4
,

co e on n, s a an a eo u s a an t a eo u s o so c e 2
p bli 9 4 ; b k f 3 5 3 7 ; th t mpl y d i
, ,

t tho e u c, 2 an s o 2 2 a e o e n ex
d p it 4 f f ; d j i t t k th l t ff t iv
,

e os 22 an o n -
s oc p t ti
or a on 3 7; e ea s e ec e, 2
mp i ii 4 4 3 mp t iv dv t g f it
,

co an es , 2 2, 2 co ar a e a an a e o s
g l ly g i lt mpl y m t
.

B en a e ar d m a r cu ur e a n an u e o en
f t i i 8;
ac
,

ur e s f pidn, 1 c a us e o ra or yi g
c arr n
f t q i d i 8 4 ;t y t h v y g wi
.

o r un es ac u re n, e e er ro n
l vi d i ii 3 9 ; M d
e e t b
n, . 1 o n s es a fi t di t
rs r ec e
lih d i 3s e n, 21
B ill f x h
s o g 1 63 6 69 ;
e c an e, 2 2 5 2
d w i g d d w ig 74 7 8
.
, ,

ra n an re -
ra n 2 -
2
B h mi w g i ii 34 8
,

o t
e a, ax o n a es n ,
ti T d
.

B o un es , see ra e
B re ad A iz f t bli h d by ss e o es a s e
f G g I 9 30 ; l
, ,

A t c o eo r e 12 -
1 re a
t iv vl mp d wit h
.

e f a ue o co ar e
b t h
,

u c m t er s
34 35
’
37 ; ea 1 1 1
wh d
, , ,

t d
e a en t mp an o a en , co ar e

4 6 ;p i g l t d i ld
,

1 f r ce o as re u a e n o
S t h l w b
co k 68 ; t x
c a oo 1 a es o n ,
ii 35 7
,

B
J ur gh p i vi l g
er s , d mp r e es an exe
 I n d ex 4 37
d t t i f b m i g p b li
es r u c on o i t mp t it i w i t h t h t f d i
y eet n u c n o co e on a o s
exp by f nd i g 4 08 ; i
en s e t t u 53 n n an o n es , 1
t y f ll w it h C l pi f h w g l t d
,

d t y
us r f C o a o un r a s o a s, r ce o o re u a e 1
m v l f 4 0 h f t i it , ,

5 3; t h
’

re o a o 5 1 1 2, 1 e s ar e o r en n
C h t d by S t h ff t d i pl by
, ,

as t g
a c c o un s, 5 3; t
r an e co c 1 no a ec e n one ac e
b k i 63 an s, 2 th i p i i th 5 3; x p t er r ce n o er s , 1 e or
C ttl i mt g l ti g d t y ii 5 3;t
.

35 6
p i f i 0 —05 5
a e, c rc u s an c es re u a n u on, 1 ax o n ,
C hi Ch i l t iv p i
.

r ce o 2 1 2 21 f oc n n a, re a e r ce o
Ch i i l d vi g t i f i 8 g d i i i
.
, ,

n a, n an na a on 4 o 1 su ar , c o rn an r ce n, 1 2,
g f
.
l3 , ,
.

19 ; l w w i o 6 3 64 fa t f es 43 n,
°
e ec o 1
gl t f f ig mm C lb t h i il d gi
,

i t s ne ec o o re mm n co er c e , o er s co er c a an a r
gh i t t i 8 5 ; k d
‘

8 5 hi l t l y t m i 4 ; ii 5 7
,

n er es n, r an an cu ur a s s e 11
°
1
w g t y l b
. .
, ,

a f es o i c o un r 58 a o ur er s n, 1

5;p i f b it i C l i G k dRm
—
11 r ce o su s s en c e 54 n as o o n es , r ee an o an , 11
mp d t E p 73 p i p h
.

co ar e o 5 6 6 4 6
ur o
5; S i 5 7 60 65 66 ;
e, 1 r ce an s
f l b 7 3; v l P t g 66 67 ;S w di h
, , , , , ,

o i a o ur f p n, 1 a ue d o re or u u es e, e s an
m t l i 89 ; g i i h 68 D t h 68 69 ;
,

i
c o us 87 e a s D n, 1 -
1 a r an s u c
d i ii 7 3 7 4 ; F h 69 ; f p p it y
, , , ,

cu lt d t ur e an ra e n, 1 1 r en c c a u s es o ro s er
h igh d d ro a l i d s ani w l i 69 ; E gli h
c an a s n, un
,

er n ne
,

c o o n es , n s
th di t i
e f th r ecx t iv on l i f N t h Am i t h i
o e e ec u e c o o n es o or er c a , e r
p w o 7; v er , 2 1 f th v p li t i l i t i t t i
re en u e o f v bl e so e o ca ns u ons a o ur a e
re ig i d iv d f m l d
n n, ert p g e 7 0 7 3; mi t k
ro a an o ro r ess , -
s a en
t ax, 7 8 t yt h l vi d i 21 l i l p l iy f S p i P t g l e e e n, co on a a n, u
°

21 o c o or a
F th
, ,

3 9 1 d t i i r an c e , an o er c o un r es , n
Ch i t i d ti l l d t v th w y f t x d m p li
—
ar es , e uc a ona ea o o er e a o a es an ono o es,
ki g f t h Ch h i 8 0 7 4 ; lib l p li y f G t
,

t
s oc n o 7 e ur c 11 -
12 2 er a o c o r ea
Ch h Cl gy B it i 7 4 ff ; lib t y
.
,

ur c s ee er f th r a n, er o e
Cl gy t h f t h di ff E gl ih l it t m g
,

er t
e, o t ii e er en sec s , n s co on s s o an a e

7 0 fi: p d p ly th i ff i 8 ; p i it y
.
,

2 ti er s ec u w on an r o se e r o n a a rs, 2 su er o r
t ii g f s n 70 7 ;i d p
o d t
2 f t h E gli h p li y v
2 1 n th t f e en en o e n s o c o er a o
p vi i f 7 3; f t bl ih th ti 8 3; dv t g
, ,

ro s on o 2 o an es a t s o er n a o ns, a an a es o
ed h h t h i p w i ld d y
c ur c
,

E e r p g o lly i i g f m t h
er
—
n o a s ur o e en er a ar s n ro e
2 79 8 0 ; b fi 2 f 8 0
,

; en e l i t ices f A m o i 8 7 89 ; 2 an c o o n sa on o er c a ,
tit t i f t h Ch h p ti l dv t g d iv d
, ,

i t
c en cons u on o e ur c ar c u ar a an a es er e
2 8 8 ; f m
1, 2i dp d
2 f m by h l i i g t y
or er n e en en c e
,

ro eac co on s n c o un r
d w lt h f i t 8 9 9 0; i w h t w y t h y h v
, ,

an 8 ea 84 ; o 2 2 -
2 an c en n a a e a e
p ivil g f 8 4 ; d li f t h b ,

k
,

r e es o 2 f w ec t th ne o e e en a c a us e o ea n es s o e
t mp l p w f t h Ch h m th 9 0; x l
,

t i
d w i t h 9 0—
e ora o er o e ur c o er c o un r es , e c u s i ve
p ivil g f 9 ; ff t f t hi
,

85 87 ; b fi t
p ly 9 3—
2 -
2 en e c es , r e es o ra e 2 e ec o s
dip i g f b f d ft ff t
,

s os n o th m e o r e an 97 ; i t a er e ono o s e ec on
R f m ti pit l f G t B i t i 9 8
, ,

e or 8 6 ff ; fl a t f th
on, 2 th e ec o e e ca a o r ea r a n,
r esp t iv v l ec f b fi e 0
a u es o 07 0; t h t xi g en e d c es o n 1 2, 1 -
11 on e a n an
un iv it y t hi g 9 3 9 4 ;
ers gv m t f
eac n 8 f th i 2 2 o ern en o -
1 1 o e r
v t bli h d h h p t ti P li m
, , ,

re f en u e o es a s i e t c ur c es , re r es en a on n ar a en
vy d th d gm t f ,

2 94 95 ; 2 m ts ur e an a s s ess en on e er an e en o
o f Ch hl d i P i d
,

ur c th
an ts l dit ib t i f t k
n r u ss a an e n a ur a s r u on o s oc
l wh 3 6 3 7
e se er e, by t d m p ly w it h 4 9
1 1 ra e ono o 12 -
12
Cl t h p i B i t ih y t m f t x t i xt d
, ,

yVI I
’
o f i H r ce o ig n enr s re n, r s s s e o a a on e en
i 5 6 ; it p i 22
,

22 mp d
,

d t s id tir ce t p i co ar e e o , c ons er a o n s as o
‘

o ss
wit h t h t f wh t 6; l t ;p p yi
.
,

a o bi lit y f 4 6 4 ea m 22 a er o 1 -
21 a er one n,
d ti i p i di t i f th i
, ,

re uc 6
on 7 n 4 3; r c e, 22 m 22 2 con o ns o e r co
Cl t h i g w h w it h G t B it i
,

o n d h w m en an m o 4 4;
re un er a er c e rea r a n, 2
t iv i 4 7 4 8 ; l y ligh t p ym t f t l t t 4 5 ; d
,

e, 1 1 on s re a en s o o a er , 2 a
d ti i p i f lt f v t g t f i w it h G t
.
, ,

uc on n r ce o a s r es u o an a e o o un o n r ea
imp v d m h i y 5 B it i
, ,

ro e ac 4 7 4 8
n er 22 r a n, 2 2
C l mi wh t i p w f C mm f t
, ,

oa t
n e, on a M s d o er o o er c e , s ee an u ac ur es an
T d
-

aff di g t d p d i 5 0
or n r en e en s, 1 ra e
wh t i t v l dp d i l y t m p i ipl f
.
,

15 ; 1 on C mm
a s a ue e en s, o er c a s s e r nc e o

5 3; p d ti t b gh t 37 5 fi ; i p i i pl m
, ,

1 f ro uc on o no by ro u s x r nc a e an s
438 T he W eal t h of N at i o n s
w hi h i p p
c t ro o s es to i n cr ea s e t he m en t giv t di v y d en o sc o er an
q t it y f g ld d ilv
u an o o an s er , w ki g for 55 n56 o 1 1
t iv d th C p ti x l iv p ivil g , ,

39 6 ff ; con r f th e ra er or e or ora o n s, e c us e r e es
b fit f t h p d
en e o th f e ro u c er s an or f th i
o ff t e r emp t i t i i ec on co e on ,
th t f th ii 5 6 ( 07 ;w h y t h y h v b t b
.
,

a o m e c o n su ers , 1 s ee 1 e a e een es a
f g i g h pt ) i t g l ti
.

o re o n c a er s lih d s e ; 1 12 a n c en re u a o ns
C mp i g l t d ii i g d
,

o a n es , re u a e 221 222 , c o n c ern n ; t w t 1 12 o n ra er s

5 ;j i t t k 5 8 y t p t th
.
, , ,

22
4 22 o n -
s oc 22 22 m ore e as o co o er a e an
l d
-

t y lb
, , , ,

22
9 4 45 2 (S 2 -
2 ee a so un er c o un r 4; t a o ur ers , 11 no
p t mp i E t I di y f th b tt g v
,

se ar a e c o an es , as n a, n e c es s ar or e e er o ern
Af i t )
r c an , e c m t f t d
en 7 ;f
o i l ra e, 11 r ee c r c u a
C mp t i t i i d by t h f l b b t t d by
.

o e t on , r es r a n e e ti on o a o ur o s r uc e
p ivil g f i p t d t d
r e es o ncor ora e ra e, p ti l w
c or ora 3 4 on a s, 1 22, 1 2 12
i 07 ; d t i f p i p fi t
1 re uc on o r c e, ro C t y
o un r di t i f t d b con ons o ra
,

e e
d w g by f mp t it i i 3; w g
.
, ,

an a es r ee co e on , tw d t w
een , an o n 1 1 a es
mp t i t i p t y l b i Ch i
.
,

1 12; co f th e on o e o o r, f
o c o un r 5 a o ur , n n a, 1 1
t k w y th w d f th ih i G t B it i
,

a es a a e re ar o er c n r ea 6 r a n, 1 1
mp t i t i h h tl d i 05
,

8;
1 1 co i th e on n e c ur c C tt
o th fS
er s , e, o co an 1
d 3 3 3; mp d wit h t h t
.
,

118 9 ;i t 11 n ra e, 22 , 2 C t hi p y
ur a e , s a co ar e a
d t t h ii 8 6
,

C on c or a e, 2 o f a n ar t i
s an , i 1 1 9 , 1 20
mp t i th t f th i f i
. .
,

C o n su on, a o e n er o r
r ank g t t h th t f th
s r ea er an a o o se Da i y i i p i fp d
r r se f i n r ce o ro uc e o
b v t h m ii 368
.
, ,

a o e e 082 09 2
l t iv p i f i i h d v bj t i
.
, ,

C o rn , r e a e r ce o n r c an a t
e n anD hi t r, s o ec ons o
p t i i 6 7; t l t t i f x i d t i ii 37 3
,

o or c o un r es , r en s a er a on o e c se u es ,
v d i 30 ; t li bl t D k S i M t t h w hi hm f
. .
,

r es er e n, no a e o so ec er , r a e s sc e e o
m y v i ti vd t x ti
,

an ar a t o n s a s r en s r es er e a ii 35 8 4 9
a on, 1

y th mm d it y 3 ;h w D bt f d d f G t B it i
.
,

i n an o er c o o 1 o e u n un e o r ea r a n,
di y p i i g l t d 3 ; 39 4 ; l p t i ip t i
, , ,

i t s or n ar r ce s re u a e 1 o an s f u on an c a on o
m l d d p t th i t x d p l g ti
,

co an an a s ur e , e r a es , an f f ro o n a on o or
l t iv v l 36 ; t p i p ym t f 39 5 39 6 ;mi p p li ,

re a e 34 a u es , 1 -
1 is r ce a en o sa ca
i t R m 36 ; t d ti f S i ki g F d f it
, ,

i n a n c en o e, 1 r en an on o n n un or s
p fit f g l t
ro o t re d u a es r en an d t i 4 03 m t f f d d
re uc on,
°

a o un o un e
p fit f p t 36
,

37 ; t d f d d i G t B it i
—
ro o a s ur e , 1 1 r en an un un e n r ea r a n,
d p fit mp d w it h 4 4 4 06 ; p t d d p ym t f
, ,

an fro o co ar e 0 r e en e a en o
th f vi y d 4 4 ; it p bli d b t x p di t t d
,

o se o ne ar 1 1, 1 2 s u c e e e en r es o r e
pi mp d w it h t h t f 4 3;j t th t I l d
, ,

r ce co ar e a o t f o 4 or, 1 2, 1 us a r e an
sug 4 4 3; t f
ar , 1 2, 1 l d r en o c o rn an d Am i
an h ld t ib t er c a s ou con r u e
gl t
re u a es ly wit h t n e ar p ou e xc e t di h g f 4 6 4 7 ;
o sc ar e o 2 2 con
th t th l t iv t d id t i f f th
, ,

ti on f a o o er cu a e s er a mon f o ur er e an s o
l d i E p 4 4 ;f t ili t y f
an s n uro e, 1 er o gm t i g v
au en l i g n re en u e o r ess en n
G t B i t i 4 5 ;p i f t h
r ea r a n, 1 r ce o o er xpe 4 9 4 30
en s es , 2
g d i p p ti t i di D m k l i f i th N w
,

oo s n ro or on o an n en ar c o o n es o n e e
cati f t h w lt h
on o p v ty e ea or
,

o er W ld ii 68 ;it l i l p li y
or
,

s co o n a
,

o c
ti fl t ti it d t i l vi d 376
.
, ,

f
o a na on, 221
°
uc ua o n s in 7 3;t r an s u es e e 1n ,
pi t d
r ce n o t i d f ll iue o r se a n a n D wb k
ra T d ac s , see ra e

th p i f ilv
e r ce ;b o ty s er , 2 22 o un D t h
u c th i t tl m t i th e r se e en s n e
o n th x p t t i f 7—8 ;
e e or a on o 11 W t ii 68 69es
,

ij i ff t
. . .
, , , ,

n ur o us e f 8 0 4 6;
ec s o -
1 1 1
d d l w 3 ff ; E t I di C mp i E gli h d
, ,

t
—
c o rn ra e an c o rn a s, 2 as n a o a n es , n s an
th i l d d l 4 35 ; m D t h th i y t m f g v
— m t ii 3 —37 ; 33 4
e n an ea er , 2 er u c e r s s e o o er n
h t i mp t 35—
c an 37 ; m o r er , er en
,

1 1 1 2 -
2 2
h xp t I di di t i f d t h
.
,

c an t 37 39 ; m er
e o r t er , as n es con on o un er e
h h E t I di C mp y i 64 65 , ,

c a n t c arr i er , 39 4 0; at w at as n a o an
pi d i b i v l f p i m t l i 87 ;
.
, , ,

u t es an d o u n t es re a ue o rec o us
r ce
a e a s n, 1
k
t a en o ff, 4 1 , 4 2 ; a t w a t h p ric e E p t d w i t h 39 4 39 5
ur o e an ra e
xp i p h ibi d i t i t t i f ii 4 5 ff ;
, ,

e o rt at o n ro te , 42 d ti
uc a on , ns u o ns o r, 2
ll i d wm t l i d f
.

C o rn w a , t i n m n es i n , r en t , an d en o
:
en s , s a ar es an ees

t ax o n , i g
1 5 4 , 1 5 5 ; en c o ur a e
.
46
2 47 ; j ,
i di t i2 f 47: ur s c on o ,
2
d ex 4 39
t he t w o c o un t r es , i 37 0, 37 1 ;h o w
enr c i h d by e t he di sco v y
er of
Am i er c a , 39 3; i
ts co mm er c e
wi h h t t e E ast I n di es , 39 4 , 39 5 ;
i p li y f w i t h g d
an c en t o c o r e ar to
th t d ii 8 ; dv g
e c o rn ra e, 2 a a n t a es
i i g t f m th l i
.

ar s n o, ro e co o n z at i on
o f Am i 8 7 89 er c a , -

Exp m m d
en s e, so f t ib t e o es o c on r u e
th th p bli
,

m
l t h i 3 0—
ore t an o er s o u c
w ea 3 ; dv t g f 1 12 a an a e o
l id t i d bl mm di t i
.
, ,

a ou n ur a e co o es ,

Ex i c se d t m d tian ii 35 9 c us o s u es
T x )
.

ff ( s ee a es
E xp t t i or ap h ibit i gi t on , ro ons a a ns
ii 4 if ; x i
,

1 d2 t m e c se an c us o s
d t i 35 9 ff ( T d
.

u es , d s ee ra e an
Ta x es )
F m
ar Y m y er s , s ee eo an r
F d l L i 365 366
eu a g dd aw , ;a s re ar e
f li i
.
,

t d
r an s er en c e f an a en a t o n o
p p y i 3 3
ro er t i 41 42
F i m i v i f f v bl
r ear s,
,

n en t o n o a o ur a e
h p m d x i
,

to t e er an en c e an e t en s on
o f i vili i ii 9 8
c s at o n , 1
Fi h h w p i f m y i i 6
.

s o r ce o a r se 21

7 ; ffi y f h m i d y
.
, , ,

21 e c ac o u an n ust r
i m l iplyi g h i p d
n u t i n t s ro uc e s
i
un c er t a n , 7 21
Fi h m p d f h i l b
s er en ,
ro uc e o t e r a o ur ,
1 9 0
F d l iv v l f b d d
.

oo r e at e a u es o r ea an
b h m 1
,
’
ut c 35 37
er s ea t , 1 34 , 1 1 ;
h igh p i i 8 h y 37
.
,

r ce n 1 t c en t ur 1 :
f l d l iv i g f d ,

r en t o an cu t at n oo
st u ff gl h f h
s r e u a t es t at o ot er
l d 4 ; ly p d w h i h
an s, 4 1 on ro uc e c
a lw y a s a ff o r s d r en t t o t he l d an
lo r d , igi l
1 4 7 ; t he or na s o ur c e o f
r ent 49 50 f ti 1li t y f 1
°
er o a l d an
i p d i g dd t t h vl
, ,

n ro uc n a s o e a ue
y th l d
,

of m an 59 ; o er an s, 1
b d
a un f th an c e f th o e c a use o e
dm df p i mtl d
,

e an or r ec o u s e a s an
t
s o n es , 59 ; t it t th 1 cons u es e
p i ip l p t f t h i h f t h
r nc a ar o e r c es o e
w ld 5 9 ; im l nd g
or 1 an a a ve e
t bl ff t d by i mp v
,

a h w e, o a ec e ro e
m t en d l t iv t i an f l d cu a on o an

3; i i p i i ,

22 f
r se n r ce o one s ec es
p
of mp t d f
co by f ll m t h
en s a e or a e
th
,

o 3 er , 22
F t f it
r an c e , r a e o t i i 80 8 ; n er es n, 1
w g i 8 ;t m f pp ti
.
,

a es n, 1 er o a r en ce
sh ip i 09 m k t t f i t n 1
°
ar e ra e o n er
es t i 3 0; f m n (M t y 2 ) ar er s e a ers
ll t d i
,

i 34 6 ; t h T ill
n, e a e co ec e n,
44 0 T he W eal t h of N at i o n s
gi
35 0;m a s t r a t es an d t o w n c o un m et a l b e so ,
s c an an d ld
il fi
c s r s t e st a s ebli h d
in t h e t o wn s , h igh es t , 1 5 7 ; c a us e o f em a n d d
l f v bl
35 6 ; law o f, ess a o ur a e t o fo r , 1 5 9 , a ue o f s ilvvl er i n pro
gi l h h
a r c u t ur e t an t a t o f E n an , gl d p i ort on t o t h a t o f c o r n , 1 62 ff ;i ts
3 7 ; h
2 ig h d ti f ig u es on o re n vl a ue n o t t o b e j dg d by
u e lo w
imp t i m p or s d by C lb t 4 ; o se o er 11 pi r ce of c o mm o di i t es , 1 70 ;
th q ti f d lvl d p d h i fly
,

d 4 6—
on e f i t u es t on o s r ee ra e r ea a ue o f, e en s c e on
w it h E gl n 4 8; an d 1 1 a t he q iyuan t t o f c o rn t e hy c an
v t g f t d w i t h E gl d p h
,

an a es o ra e n an u r c a s e , 1 7 0, 1 7 1 1 72 ; c a u s es
l i i th W t h d hi
,

4 38 4 39 ;i t s c o o n es n e es t a t c o n u c e t o i n c r eas e t e r
ii 69 ; l i l p li y f 7 7 3; q iy i
, ,

co on a o c o 2, u an t t n c r ea s e i n
b l t g v m t t bli h d q y di i i h d
.
,

a so u e o ern en es a s e u an t i t h as n o t mn s e
i i n t l i s 8 3; C lb t
c o o n es , o er
’
s hi vl
t er a u e, 1 75 ; di v ys c o er of
a g i lt l y t m 5 7 5 8
r cu ur a s s e 1 1 i
m n es i nA i vl
mer c a , 1 7 5 ; a u e
ex t iv p w h g d w it h
ec u e o er c
,

ar e
,

silv er i n p p ir o o r t o n t o t at h
th m i t e a n f t h h ig h
en an c e o d e ro a s c o rn d p i d
(s ec o n er o ) , 1 5 70
an d l i c an a s 6 9 ; th n 21 21 e 1 64 0, 1 75 , 1 7 6 ; (t hi p i d
rd er o )
T m i db
, ,

a e 336 337
n, th e 1 637 1 700, -
1 7 6 ff ; e a s em en t
V1 gt é m i 339 ; t mp d t i ilv i
.
,

1 78 ; c o m
'

n 1 c n s a u es of s er co n, 1 7 7,
d d ti p i t ti i i vl f i E p
—
t
an u
g es u on re s ra on n, p ar a v e a u e o n ur o e ,
34 3 34 5 ; t g t i 34 5 ; s ec r e re is er s n an d
,

t h e E as t , 1 8 7 1 8 9 ; c o n
pi t t i t x i 35 0;P é g pi
,

ca a on a es n, a es ti n u al c o n s u m t o n o f, 1 8 9 , 1 9 0 ;
i 37 5 ;
n v l w i 38 ;
re en u e a s n, 2 an n u al p i
im o r t at o n of i nto
f mi g f t x i 385 38 6 ;
ar n o a es n, p i
S a n, 1 9 0, 1 9 1 ; p 1 0p o r t i on
wh i t
en c e h i f v d iv d s c e re en u e
,

er e b et w een t h e r es ec tp iv v l e a ues o f
q i it f m ti g ld ilv f
,

38 6 ; re u s f e re or a on o o an d s er , 1 9 2 1 9 5 ; ef ec t -

fi n an c es i 38 6 38 7 ; y t m f n, s s e o hi
o f t ax o n , 1 9 5 , 1 9 6 ; t e r c o n
t x ti i i f i t th t pi p i
,

a a on n, f n er o r o a o s u m t o n an d i m o r t at o n , 1 9 7 ;
G t B i t i 38 7 ; l f S t t
re a r a n, sa e o a e vl iv
a u e o f s l er i n o ld Ro me, 1 9 9 ,
bill i 39 4 ;p bli d b t i 4 00
s n, u c e n, 2 00 ; i d d
n E w ar
’
I I I s ti me , 2 1 2 ;
4 0 ; by w h m m
1 y dv d o one a an c e
,

in 1 4 2 5 , 2 1 3; h igh o r lo w vl a ue o f
i 40 40 ; d lt
n, 1, ti 2 f i a u er a on o co n no p fro o o f t h e w e a t lh p v y or o er t

i Ki g J h t im y
o f a c o un t r , 2 1 9 , 2 2 0 (s ee Mo n e ) y
’
n n 4 5 o n s e, 1
F g—
ru li t y p bli b f t i
a a u c en e a c o r , G gi
or as , h i s w ay o f livi g i n , 1 21 ,
p i ipl w h i h
. .
,

30 304 ; t h1 e r nc e c 1 22
p mp t t 305 ; x p
ro s o l id e en s e a G v m t ivil
o ern en igi d c or n an
d bl mm di t i g wt h f 9 9 ff
, , ,

ou t i n ur a e co o es ro o 11 1
f v bl t 3 3 G i pi f i E gl d d
.
,

a o ur a e o, 11, 12 ra n , r ce o n n an an
F d t h g l f G t B it i S tl d 1 67 ;i F
,

un e en er a o r ea r a n, co an 68 n r an c e ,
G t B it i pi t l t k f i
.
, , ,

11 307 r ea r a n, ca a s oc o
F di g y t m f 4 08 4 09 ; l d i 44 4 5 ;
.
,

un n s s e o 11 84 ; c o rn an s n 1 1

f bli g t t h S t t 4 0 4 lib l l i l p li y ii 7 4 ff ;
.
, , , , ,

en ee n o e a e, 1 11 er a co on a o c
p ly f l i l t d
.
, ,

G d
h
—
erm
f
ono
p pi
o
l f
o co on a ra e,
f th f
— h
en o a , r ea so n o e e arn ess o 9 0 7
9 ; f t e ec t u on er c a a o
l i
,

c o rn i i 74 n, 1 9 8 0 5 1 0 7 0 ; h 1 i 11 er c o o n es n
Af i
-

G ld d ilv v y i v l 1
.
,

o an s er , ar n a ue , r ca d th E t an 30 3 ; e as 1 1 1
h t x i 3 6 ; t mp d t i , ,
.

28; t no t m an fa c c ur a e eas ur e o o u se a n 2 s a u es
v l f th mm d it i p i ip l x ,

th e a ue o o er co o es , in , 34 ; 2 t r nc t h a a es on e

28 v l °
f di m i i h d by d i
a ue o n s e s i
n ec essar es f li f i 35 5 ; o e n, on
i Am i m bl mm di t i i 38
,

c o v er y f t h mi o e n es n er c a , c o n su a e co o es n, 1

30 ; p i g l t d by i t i t y
,

f mm f
.

r ce o c o rn re u a e n er o r co er c e o c o un r
vl a ue f ilv o3 wh s d er , 1 en u se l ft f by t h y t m f t x
e ree e s s e o a a
i g 34 ; g ld igi lly ti yt m ft x
,

f or co na e, o or na oni n,i
t s s s e o a a

no t l g l t d i E gl d 35 ;
a e a en er n n an ti on p i t th t f
su er o r o a o
r esp t iv v l ec f e 35 36 ; a ue o
,

m k t p i
, ,

ar e f 36 4 54
r ce o t -
1, 1
°
r en
ilv mi i P
,

an d t x a on s er n es n er u ,

54
1 5 5 ; d f g ld m i
1 an 56; o o n es , 1
l w t pi t whi h p i
,

o es r ce a c r ec o us
 I n d ex 44 1

d f 398 ; by w h m m y t im i 7 ; k it t d t k i g
‘
F un o o one e, 22 n e s oc n s
dv d i 4 0 ; m t f t k w t ll l t
.
,

a an c e n, 1 a 7 o un o no no n 1 a er , 2 2

p bliu d b t c f 4 04 4 06 ;fl
e i
s o h H pi t li t y -
x t v g f b f o ur s os a e ra a an c e o e ore
ig n di t icon f ft l t w on th
,

o x t i f mm 1 363
a er a e ar , e e en s o n o
,

co er ce,
,

; imp ibilit y f lib

.
,

4 12 364
o ss o er a
t i g th n p b li v e f 4 5
u H c re d f
en u e o t i L d i 1 o u s e, ear n ess o r en n on on,
migh t t h y t m f 07 ; b i ldi g t ii 3 3 ;
.
, ,

4 6 ;h w f
1 o ar e s s e o 1 u n r en 21, 22
t x ti ppli bl t ll g d t 3 ;t x h
.
,

a ai b on n e a ca e o a r o un r en 22 a on o u se
p vi f t h E mp i 4 6 4 3 3; f ll h vi t
,

ro n c es o e t 3 r e, 1 -
21 r en 22, 2 a s ea es on
m di m b tw i h 3 4 ;d ifl b tw
,

e fu mm o th
co er c e e een e r c 2 er en c e e een
th C l d 4 4 4 5 ;j h t f l d 3 4;
,

e i o o n es t an t d 2 2 us o us e r en an r en o an 2
th t I l d d Am i h ld h w h h ld b t d 3 4
, , ,

a r e an an er c a s ou o o u ses s ou e ra e 2
t ib t t y g d t m p p
, ,
’
c on r t th
u e 3 5
o e c o un r s 2 r o un r en s o re ro er
v 4 6 4 7 ; dv t g t bj t f t x t i t h h
,

re en u e, 2 2 a an a e o su ec or a a on an o us e
C l i f i wi t h 4 7 4 8 3 5 ; g l ti f g d
,

o o n es o un o n t 2 2 r en s , 2 re u a on o r o un
id t i f f th t 3 5 ;g d t p i
, ,

c on s er a m on o ur er ean s r en 2 r o un r en a s ec es
gm t i g v l v p p
,

f o r au en n f re 3 6; m
en u e o r ess en o re en u e , 2 ore ro er
i g xp
n e 4 9 4 30 en ses , 2 bj t f t x t i t h t f su ec o a a on an r en o
d t g d by ii l d 3 6; t f t x d i m
,

G r eec e, t ra e no en c o ur a e an 2 r en o a e n sa e
pi f t i p p ti f l d i
.
, ,

177 ; m en o r o us r ce t o c er a n ro or on as r en o an n
g d i 7 8 79 ; d t i i G t B it i 3 6 3 7 ; t
,

oo s n 1 1 e uc a on n r ea r a n, 2 2 ax on
h i H ll d 3 7 ; h th
, , ,

258 6 -
267 68 ; m
1, 2 f 2 en o o u s es n o an 2 ear
l tt g lly t h t d di g t
, ,

e ier s n, t x
en er a 3 7; eac er s , a 2 ra e acc o r n o
mb f wi d w
,

294 3 7 3 8; nu er o n o s, 2 2
d t wi d w t
,

G r o un H
r en s , s ee o use 3 8 ; ff t f n o ax, 2 e ec o on
t 3 8 r en 2
H mb g t k i 33 B y C mp y
,

a ur t ax o n s o c d n , 11 9 3 2 u so n a o an 11 22 2 1
H mb g C mp y 1 p d th i l b
. .
, , ,

t f
a ur o
uan 1 2 22 n er s , ro uc e o e r a o ur ,
i g fi h y b ty g t d t
.
,

H
iii 8—
err n s er 90 o un r an e o, 1
pp t i hip
.
,

1 22 b d y us an r no a r en c es
H id x t iv m k t f h w th gh t y f i 4;
, ,

es, e en s e ar e o r, o ou n ec es s ar or, 11
pi ff t d by i p i i t llig f th
.

r ce a ec 0 e ; 21 21 1 su er o r n e en c e o o se en
p i f i 4 5 3; l d g g d i 5 ; D m it
.
, ,

r ce o n 1 2 21 r ea d an a e n, 11 e ocr us an
mi l p i 4 ;p i C l m ll
,

no na f 3 r ce o 21 39 40
21 r ce o u e a on, 1 1
y 4 ; ffi y
, , ,

o f i 8th n 1t c en ur 21 e c ac
f h m i d t y i m l t iply f i 37
,

o u an n dl us r t l n u en ess , n a ur a c au s e o
i g t hi p d t i g d x mp t d f m
.
,

n i
s ro 6
uc e mp t t i s un cer a n, 21 or a on, oo s e e e ro
H g o i i p i f i 07
s, r se n r ce o d t i ii 38 ff ; x i 2 d u es , 1 e c s e an c us
H ll d p p t i t ly i h d t i 35 9 if ( T d
. .
, ,

o an ro t m
or on a e r c er o s u es , s ee ra e
th E gl d 1 8 ; t f d T x )
, ,

an n an 1 ra e o an a es
i t t i 8 ;w g d p fit I d t g i lt
,

n er es n 1 a es an i 75 ro n o s an , a r cu ur e n, 11 1
i 8 ; d d y f it t k
.
,

n, 1 re un 77
an c o s s oc I
f hi bl I d t y pl t y q i k d th ,

8 ; 2 un as t t b on a e no o e a n us r en u c en s , e ar
f b i dimi ih i 74 ; it
,

m an o i 8 6 ;w h y
u s n ess n, ti c o rn n s es , s c o nn ec on
i l yi gt d i wit h i k 8 3; t
.

s c e ar c ar r f t n ra e n n cr eas e o s oc no

4 8;D t h
1 l i ii 68 69 ;
u c c o o n es , g d by l g pp t i en c o ur a e on a
,

r en ce
l i l p liy t f v h ip 0 ; mp t t i f
.
,

i t s co on a o c no a o ur s s, 1 1 1 11 co u a on o
bl t d v l p m t 73; it q t ity f w h i h t h i
,

a e o th e u an o
d th E s
e e o en c e c r
l i i Af i pit l f i ty
, ,

c o o n es n r cal tig an e as cu a n ca a o a s oc e c an
13 ;h 1 t x i o use 37 ; p a mpl y n, 60 6 ; w hy w
1 ex c e e o 2 2 1 e ar e
pi t l l vi d i id t i th f , ,

ti l t x
on a a on m ca a e e n, ore n u s r o us an o ur o re

333 334 ;t v t i 339 a x o n s er f th 99 ; an f i s t i

n, ; a er s , 2 ca u s e o n c er a n
p i i 34 ; it i 9 9 300 ; p p t i
, ,

t x a u on s u c c es s o n n b 1 c es , 2 ro or on e

m p d i d i idl g l d by
, ,

t
s a t -
du t es t w an d u t es on een , an en es s , r e u a e
re gi t t i i 34 34 3;t
s ra on n, th p p ti b tw
2, pit l ax o n e ro or on e een ca a
b d i 35 7 ; h vy t x
r ea n d vea 30 a es on an re en u e, 1
ne m i f li f
ar es i 38 7— 38 9o I k p hi p fi t bl t d i
e n, ,
nn ee er , s ro a e ra e, .

4 11 90
H ose l t h p i f i E dw d I v
c o ,
r ce o I n l ul t i f p mi m ar
’
s n s ur an ce, ca c a on o re u

P
44 2 Th e W eal t h of N at i o n s
i 9 6; trad f d j i t t k J ti e o dmi i t t i i
an o n -
i
s oc us c e, a n s ra on o n ec ess w

mp i ii 4 3 t t d by i i p p ty i
.
, ,

co an es , 2 i a e n cr ea s e n ro er
t p fit f t k v y wit h t im
. .
,

I t
n er es ro s o 99 ; t s oc ar f 1 a one e a s o ur c e o
m k t f i 79 ; l g l v q t
,

ar t e ra e o t 03 04 ; e a ra e re en u e, 2 2 c o n se u en
y VI I l t im 79 ; b i 04 05 ; pt
.
, ,

f i H
’
o n en r s e, a us e n, 2 2 ac c e an c e
b li h d d E dw d VI 79 ; f p
, ,

a o s e un er t i t
ar f 05 o r es en s n r e urn or, 2
l g l t t ill 06 ; fi x d l i f
, ,

t en p ert th c en e e a 06 ; d
ra e 2 e s a ar es o r, 2 e
J m I t im 7 9 ; t i t d t
a es
’
s e,f yi g t h x p r es r c e f by f o ra n e e en s es o ees
e igh t p t d l t
er c en d f an t 07 08 ; by
a er t mp
re uc o c o ur 2 2 a s a
ti 79 ;l g l d m k t d t y 09 ; by f d i d
, , ,

o n s, t e a r a e an ar e u 2 un r a se on
i S tl d 80; i F l dd t t by l
,

ra e t n co an n f
r an c e, an e es a es , or o an o
8 0 8 ;i H ll d 8 ;i N t h y 09 ; p t i
,

1 n o m an 1 n f th or one 2 se ara on o e
Am i d W t I di C l j di i l f m t h x t iv p w
,
, ,

er c a an es n an o o u c a ro e e ec u e o er ,
i 8 ; ff t f q i it i
n es , 2 e ec f 0; o y f t h i mp t i l
ac u s on o 21 n ec es s ar or e ar a
ne w t it y err w b or h f dm i i t t i
or n e f j tir an c 0; o a n s ra on o us c e, 21
i d ty 8 3 8 4 ; h ig h h w t m t xp
,

n us r on, t i f 97 ra e n o o ee e en s e
s o 2
Ch i 8 5 ; h ig h
, ,

n a, t i i t ra e n a n c en
t im t d f
es a c c o un 8 5 h ig h t eK lp i t or, i 3 ra e e s u s es , 1 1
m g th M h m t ti Ki t h g d d p fit f
.
,

a on e a o e an t na o n s, c en ar en s , r en an ro o
ff t d by t h ih
,

8 5 86 ; as a i 39 4
ec e e r c es 1 1 o
t y 86 ;p p ti b
.
, ,

o f a c o un r ro or on e
i t t d l p fit L b divi i i
,

tw een n er es an f
c e ar ro a o ur , s on o o c c as o n s a
yd l dd dt dd p p t i bl i
, ,

8 7 ;m one e an e an f th ra e ro or ona e n cr ease o e

i t t 3 4;m y d i t t p d t iv p w f l b
,

6—
n er es 1 one e n 1 er es ro uc e o er s o a o ur

i th p ti l iv l p
.
, ,

n c r eas es a s f e 0 ;t h or on of an n u a 1 e c a us e o un ers a o u
p d ro d ti d t
uc e pl
es l ne d mm d t i
o re 0 ace en c e, an ac c o o a on , 1
ca pi t l i a 3 5; i t
n c r e a s es , t ;t h q 1 f n t i er es 11 e c o n se u en c e o a c er a n
,

dimi i h n s m t f t
es a s a kt p p it y i h m o un o t s oc ; o ro en s n u an n a ur e, 1 2
b l e t i en 3 6 ;l w i g f
n cr eas es , p ti 1 it y t m
o er n o co o -
er a on a n ec es s o an ,
t
ra e o f t d t t h di
no v y ue 3;d ot t e l t d yi sc o er 1 2, 1 ue o n a ur a en en c n
f th Sp i h W t I di 3 6 ; t b 3 4 ;diff
,

o e an s m tes n es , f 1 an o ar er , 1 1 er en c e o
f i t p bf t l ff t d by 4 ; d i imi ,

ra e ot t i E n er es t n ur o e e o re a en s e ec e 1 ss ~

i 3 6 3 7; v l f g i flt m ,

an d s n c e, f 1 l i ty 1 a ue o ar o en u s use u o an ,
p p ti b tw d th t 5 ;limi t d by t h xt t f t h
, ,

ro or on e f een an a o 1 e e e en o e
ca pi t l 3 7 ; l g l t f 3 9
a 1 m k te a 5 ;th ra e l m o f 1 ar e 1 e re a e a s ur e o

3 0; m k t i F x h g bl v l f m
, , , ,

2 t ar e d th
ra e n r an c e a n e e c an ea e a ue o co
E gl n d 3 0; tan p 2 t m di ti ax 7 9 3 ;di
u on fli lt tc an n o o es , 2 2 2 cu o
t i p p t i b t w di f
, , ,

i
r a se th t f i i 330 ;
e ra e o r easo n s a s c er a n ro or on e een
l p p bj t f t q t it i v
.
,

why a es s f ro er f
su 7; ec o er en u an es o 2 ne er,
di t t x t i t h t h v i iv l 9 ;i w h t
,

r ec a a t onf an e r en o ar es n a ue, 2 n a s en s e
l d 330 33 w h ff t d by
an 1 i t h l d mi l p i
en a ec e a s a r ea an no na r c e,
t x p fi t f t k 339 ; y pi d
, , ,

a es on ro 9; i ts m o s oc t 2 s one r ce o es no
m k t A fl t t wit h m y p i
,
’
ar t
e i Q ra e n u een f nne s uc ua e one r ce o
re ig 39 8 n, m 3 ;w h d wh t it co 1 en an en n o s
I l d it bili t y t p y l d t p d b l g t th l b
,

r e an s a o a an ax , ro uc e e on s o e a o ur er ,
ii 4 7 ; it t ib t i d vl
,

1 t w
s con r 4 4 3 44 ; m u on th o ar s 2, eas ur es e a ue

di h g f p bli d b t 4 6 d p fit 44 ; w h l
.
,

sc ar e o f ut c e 2 o r en an ro s, o e

4 7 ; dv t g t i wit h p d i gi lly j y d by , ,

2 a fan a e f
o, o un o n ro uc e o or na en o e
G t B it i 4 7 th l b 5 7 ;p i f d
,

r ea r a n 2 e a o ur er , r ce o ear er
f p id t by hi h i E gl d t h i S t l d 67 ;
, ,

I t
s o c r a es , ees a o, s sc o n n an an n co an
l i ars , 121 th ff m h p th th t at o r ee en c ea er an
,

I t ly i f t h i t i i i 35 8 ; f l v 7 ; li b l w d f
.

a r se o e c es n, o s a es , 2 er a re ar o
f ig mm i 373;t g th i
,
.
,

o re n co er c e n, f p p ax o n en c o ur a es e n cr eas e o o u
b d i ii 35 7 ; t i t d t i
r ea n, l t i 7 7 3; m y p i f r an s u es a on, 2, one r ce o

l vi d by 37 6 ; t x v l f g l t d by t w i m t
.
,

e e a on a ue o re u a e o c rc u s an c es ,
t i N pl 38 ; v 7 6 ;d m d f h w ff t d by
,

t
c o n r ac s n a es , 1 re en u e e an o r, o a ec e
l w i 38 3 38 4 ; f m i g f
a s n,
p l ty d i tyar 7 6 77 ;
n o en an s c arc

t x i 38 6 ; y t m f f di g t p d t iv p w
, , ,

a es n, s fi
s e o un n 1n c r e as e o s ro uc e o ers

i 4 n, 11 by i f t k 77 8 7 ; i n c rease o s oc , ,
n
 I n d ex 4 4 3;
cr eas e of i
ts pi r ce co m p en s a t e d v i w it h t h f t ili t y f l d
ar es e er o an
“

fo r by t h d imi t i f it qe nu on o s u an d wi th i t it ti s s
33 34 ; ua on, 1 1
t it y 7 8 ; h igh p fi t d t l t iv v l fp t
,

t ro s en o re a e a u es o d a s ur e an c o rn
i p i f 87 8 8 ; h p i
r a se
,

r ce o
’

c ea er , n l d 34 36 ; t d p fi t
an s, 1 -
1 r en an ro s
wh k p id i t f p d q i ig m
, ,

th w ti
—
c a s es er e e or a s no o ro uc ons re u r n ore
:

th l mpl ym t f l b
e so e e o en o a o ur er , e xp en s e a n d 3 8 4 ; l c ar e, 1 1 1 re a
1 05 06 ;p 1 p ty f v y m ro er o e er an t iv e r en t d p fit an f vi y d ro o ne ar
i hi w l b 0; f d p t
,

n s o n ai o ur , 11 r ee c r an d c o rn an 4 4 ; a s ur e, 1 1, 1 2
l t i f b t t d by p th l t iv t i f g d?
—
cu a on o o s r uc e cor o e cu a on o su ar an
ti pp t i h ip t b f l d
,

ra d
o n s an a; r en c es 122 o ac c o , 4 44 ; 1 t 2 1 r en o an
an d by t h P L w e 3 7; oo r a s, 1 2
,

12 p d i g f d t ff
ro uc n gl too s u s r e u a es
l t iv t d l d
-

q l pi i di ff th t th
.

un e ua f r ce t o n er en a f o o er cu a e an
pl wi g t t hi 7 ;p t 44 ; i fi ld 4 5 ;p t t fi ld
, ,

a c es , o n o s, 12 ar 1 r ce e s, 1 o a o e s
o f l b a i p i
o ur fm t l n 54 ; r ce o e a s, 1 1 45 4 6 ;f
1 d t h ly p d oo e on ro uc e
lm f th v l w hi h l w y ff d
, ,

th e r ea eas ur e o f e a ue o c a a s a t t or s s ur e r en o
silv d ll t h
er an mm d it i
a o er c o o es , th e l dl d 4 7 ; p d
an or t
1 ro uc e no
ypi dp d i v i bl y ff di g
,

1 70 ; m one f r ce o e en s n ar a a t 47
or n r en 1
h i fly v g m y pi wh l t h i g d l d gi g
, ,

v 4 7—4 9 ; f d t h
c e on a er a e one r ce en c o n an o n ar e ~
o f m co 7 ;l b 1 i th 1 lt i a o ur s e u re m u n er ati e, 1 1 oo e
m t p i p id f v yt h i g gi l
,

a e r ce a or e er n or i na f t
s o ur c e o 5 0; t r en 1 r en
17 3; p i f i Ch i
r ce 7 3;o n n a, 1
,

f m l mi
ro coa 50 5 ;f m n es 1
,

1 1 ro 1

y pi f i i G t t imb lit t l
, , ,

m one r ce o r s en n r ea 5
er , 1 t h
1 r en as e
B it i mp v m t i t i th p i f m t l
, ,

r 8 3; i
a n, 1 ro e en n p a1 n e r ce o
54 ; e a s, 1
p d t iv p w
ro uc f l w
e pi o ers o o er r ce r en t f ti o d l d mi n an ea n es in
o f m f t
an u ac d i l
ur es , an
,

r a se r ea G t B it i 5 4 5 5 ; f ilv
r ea r a n, 1 1 o s er
"

f l d 9 ;th i t t mi
,

r en t o an 22 e n er es s n es i P n 54 er u ,
55 ; d f 1 1 an o
o f th l b e a t i t ly
o ur er s r c t d
,

c o nn ec e g ld m i
o 5 6;
n es , f i 1
,

o p r ec o u s
wit h t h i t t
e f i t y 30 ;
n er es o so c e 2 t
s o n es , 58; 1 t f mi r en f o a ne o
p d t iv p d t iv i t h i i p p t i t it l
,

uc
— d uc
ro e an un ro e e er s n ro or on o s re a
lb a o ur , 2
94 9 6 ;t h p t f t 2 k e ar o s oc t iv f t i
e lit y 5 8 ; t f t t
er 1 r en o es a es
mpl y d f th b v g d t th i b l t
,

e o e th or one or e o er , a o e r o un o er a so u e
29 6 9 8 ;p p t i
2 b tw p ro or on e e en ro f t ilit y 5 8 5 9 ;i
er 1 ff 1 n c r e as e o er
-

p d t iv i i h di p d i gf d
, ,

d ucti d
v e an un ro uc e, n r c ti li ty f ol a an n ro uc n oo
an d p oor t i 98 c o un
99 ; r es , 2 2 i
n cr e a s es th v l fm e y th a ue o an o er
°

p d t iv l b l i l d 5 9 ; p t iv v l
,

ro uc e a o ur a o n e n cr e a s es an s, 1 r es f ec e a u es o
vl a ue f th o l p d e f an n u a ro uc e o p d p d ig t
ro uc e ro th
uc n r en or o er
th el d 306 307 ; t x
an a es on wi s e, 60 1 6 ; i d ti 1 1 f cons
,

er a on o
it i f l f h w f t h y t th f p d
, , ,

n ec ess es o i e o ar e i s t
r ee s o r s o 98 i f; ro u c e, 1
i th p i
r a se f
e 4 09 4 0; r ce
,

o 1 n e c es s ity f i i th p i o r se fi t n e r ce o s
y p i f g l t d by t h t p d t it t hi f
, ,

m one r ce o re u a e a ro uc e 09 ; 2 cons u es c e
ii ; p d t iv lt h f v y t y
, ,

of c o rn , d 11 ro uc e an w ea o e er
3; c o un r 22
p d t iv di g t t h imp v m t d l t iv t i f
.
,

un ro uc e, ac c o r n o e ro e en an cu a on o
sy t m f F h p h il p h
s e o r en c os o er s , h w t h y ff t
o e im l d g
a ec an a an ve e
1 58 66 ; x p i t i
-
1 f th
e os on o e er r o r s t bla f d 3; l t f
e oo 22 r ea r en o
f t hi 7 ;t x i d by imp v m t i t h
, ,

f 34 6—
o t t m t
s s a e 68 en 1 -
1 2 a es r a se ro e en n e
w g i mt
,

on th 34 9 ; p ro c r cu f
s an c es o t 8 i s o c ie
e a es o
y ; 22 n
h w hi d d by t i di t ly i t h
, ,

d uc ti v e, o n er e c er a n so m e c as es r ec n o ers
m th d e o f d f yi g p b li
s o e ra n u c i di t ly 9
n r ec t f 22 f th °
r en o
,

one o e
e x p 4 07 4 08en s e, th r ee p t i t w h ih t h p i
ar
,

s n o c
,

e r ce
L d l t f i 30 3 ; l p d divid
,

an t n a ur a r en o 1 1 1 o f th e ann u a ro uc e es
xt d m d d f im l f 30 ;i t t f p p i t
.
, , ,

e t
r a r en on, e an e or i t se 2 n er es o ro r e o rs
th i p bly t d wi th th
,

p ro ve m t d fen d
s , an or o er a v an n se ar a c o n n ec e e
t g a 3 ;t h p
es , 1 1 f f e n ce o r u se o a g en er a l i t t f i t y 30 n er es o so c e 2
°

p ly p i g
, ,

m o no o 3 ;h w p r c e, 1 1 o ro r o ss t r en d t t
an 5 ne r en 2 1
p t i d 3 high l w t
or one 1 1
°
or o r en r en t i i p p ti
n cr ea ses t n ro or
,

on
,

o
dp d e en h igh l w p i f
s on
,

or o
‘
r ce o th e x t t b t dimi ih i
e en u n s es n
mm d i t i p p ti t th p d
,

co o 3 ; i es , f 1 2 n cr ea se o ro or on o f th e ro uc e o e
p d ro d di
u ce anmi t i fl b nu on o a o ur l d 98 v l f
an 2
°
lp
a ue o ann u a ro
p fi t t h l dl d 33; t d i d by p d t iv
,

ro e an or ,
1 r en uc e n cr e a se ro uc e
 4 44 W e al t h of N a t i o n s The
lb l
a 3 6 3 7 m k
o ur L th
a o n e, t 35 5 ; 0 i t 0 ; ar et ea er , ax on, 11 a n c en
f d p d t m k m d i
.
,

r at e o e en 36 en on ar et c us t o s u t es o n , 0
fi l w f p im L iq f m d d pi i
,

r at e o 3 n t er es t , 20 ; a o r o uo r s , er en t e an s r t u o us ,
g i r en d il tu e anp d iv ii 368 369 ;
en t a ro uc t t ax o n ,
e
x iv p p t y f v bl wh x mp f m x i d i
.
, ,

e t en s e ro er un a o ur a e en e e t ro e c se u t es ,
imp v m
to 34 ; mm ro 369 e m f v
en t , d w 4 co on ; a o un t o r e en u e ra n
f i S
r en t l d or,im n f m 37 ( M l t )
c o t an at o n e t e, ro 0 s ee a t ax -

p w f h ld ll di l d gi g w h y h p i L d
,

36 4; o er o t e o a o a o n s, c ea er n on on
l d 365 366 ; h g i h
or s, th i P i d E di b g h 1 c an e n t e an n ar s an n ur
p l x p di , .
,
er s o n a f h e en t ur e o t e
l b gh b
a t t er by i L d d f h
t a o ut
t i
—
ro u n on on, earn ess o o u s e r en n
d mm
cr e ase 3 66 369 ico i 6 d h p f l dgi g
er c e , ;o r 10 an c ea n es s o o n
,

s,

gi f l gl 368 ; p fi t t
.

n o on 6 e a s es , ro o 10
h t y d iv d f m m L
e c o un t r i i 96 er e ro co o t t er es ,
f
.

m v
d mer c e 369
an a n u ac t ur es ,

37 ; dv g f m ll h ldi g M h i y imp v m t i i
,

0 a an t a e o s a o n s, ac n er ro e en s n,
5 22
i g i Rm , .
,

7 0 ; law c o n c ern n n o e, 227

3
ii 5 5 ; mi p ro v m t f di
e en o sc o ur Ma l t t a x 11 370 37 5
- -

g d by m p ly 08 ; g i l Man u ac t ur es o f v ar i o us
f d
. .
, ,

a e ono o 1 a r cu ki
n s,
l yt h g wi g imp v m t d h p
, ,

t m f th F
—
ur a s s e o e r en c ro n ro e en an c ea

p h il ph o so er s , 1 5 8 66 v f 1 re en u e o f i 8t h
n es s o t y i 69 7 0;n 1 c en ur
E mp f Ch i d iv d li d w ll i S tl d d
, ,
.
,

th e er o r o na er e n en an oo en n co an an
f m l dt
ro a an -
ax, 2 1 7 ;r en t o f, a s Y k hi or p d
s f by
r e, ro uc e o
a
— l d s o ur c e of m ai
n t en an c e o f t he wh t ff t d 7 6 pi t l m
a a ec e ca a
,

e
pl y d i 3 5 3 6 ; m f
,

S t a t e, 302 305 ; an m -
t ax, a o un t o e n, 2 2 an u a c
f v
o i i g f m i G
re en u e ar s n ro n r eat t f
ur es di t t l h w i t or s an
,

s a e, o n ro
B i i 3 r C l
ta dn, 04 ; r o wn an s, re d d i t
uc e diff t nt i o er en c o un r es ,
'
i i g f m
v en u e 5
ar s n ro 304 , 30 35 9 36 ;w
-
lt h i i g f m l1 ea ar s n ro es s
d bl t h t h t d iv d f m
, ,

h f 9 ff (
306 ;t a x o n t e r en t o , 30 s ee ur a e an a er e ro
T x ) fi f
a es ; l fl
n e o r r en ew a o ea s e, g i lt
a r cu 37 3 37 4 ; d iv
ur e , er e
di i d
31 2 ; c o n t o n s a t t en a n t on th g e t t dv t g f m t h
r e a es a an
,

a e ro e
i l
c er t a n ki d
e a s es , 31 3;r en t in n , m p ly f h m m k t 4 03;
ono o o o e ar e s,
l dl d h ld
31 3; t h e an o r s ou b e en co mp t i t i m g e dv t g on a on a an a e
l iv
c o ur a ged t o c u t p at e a ar t , b u t o us t th p pl 4 37 ; t i
o e eo e,
,

c er a n
p t l y f hi l d 3 3 3 4 ;
a ar on o s an 1 1 g d p h ibi t d t b imp t d
oo s ro e o e or e
v y d v l ti f i P hm mp t i ii
, , ,

s ur e an a ua on o n r us f or o e c o n su on, 2,
3;
i B h mi Mil S v y p i fh m i d t i g l t d
, .

s a, o e d a, an , a o an r ce o o e n u s r es r e u a e
Pi dm te 3 6 ; t it h onl vi d 1 e e e on by t h t f 0; p
a mi m o c o rn , 1 re u s
p d f 3 8 3 ;di ff giv f t
,

th e ro uc e o 1 -
21 er t en m o
3 an u a c ur er s 2
ence i t f t h
n t
r en o
,

o o u s e r en i t p li y f E p
an c en o c o
,

ur o e c on
g d p p i g 9 ; th i l b
, ,

3 4 ; 2 t m r o un r en a o re ro er c er n n 2 e r a o ur un
bj t f t x t i t h p d t iv di g t t h y
,

su ec o t f a a on an r en o ro uc e ac c o r n o e s s
l d 36 l l dt i f th F h p h il p h
60—
an 2
°
an n u a an -
ax n t m e o e r en c o so er s ,
G t B it i v l t i f 3 6
,

63; x p i t i
y t m 68—7 ; t di
r ea r a n, a ua on o 2 1 1 f th e os on o e err o rs
f t hi
, ,

32 7 ;t a x o n r en t o f, c an n o t r a i s e o s s s e 1 1 2 o
mi i h t h mb f di m i i h
,

r en t s , 32 9 ; r easo n s w h y a m o r e n s e nu er o n s es
p p bj
r o er s u ec t o f t a a t o n t an x i h th h m m k t e d di
o e g ar e an
,

sc o ur a es
in t er es t , 330, 331 ; an t ax, i ts l d g i lt
a r cu 79 ; p g ur e , i 1 ro r es s n,
d li g i h
ea n w t s t o c , 331 , 332 ; an k l d i n c r ea s esth xp f w e e en se o ar ,
ll
t a x B i , a t ax o n n t er es t n o t o n i 185 86 ; p i f 1 i d by r ce o r a se
pi l w g
,

ca t a , 333, 334 ;o n e o f t h e t w o t x a on
34 7 ; t x a es , a es
or igi l na s o ur c es o f r e v en u e, 4 09 , b i g h vi t
ear n
38 8 ( ea es on, s ee

4 0 1 un d T d f D wb k der ra e or ra ac s an
d ig i g ti )
.

an d
w a t er c arr B
'

L an c arr a e -
a e, o un es
dv t g l i
-

a an a es o f t he a t t er , . 1 6, Ma i g
rr a t p v t d by p v t y
e, n o re en e o er ,
I 7 1 70
d t B ill bl t mbi
.

L an ax 11 333 M t
a s er s , a m e o co ne o re
d mi l d i ly t h w km i 5 9
.
,

ea i n es n Scot an r en t o f, ea si an or en ,
p i i p p ti t
.
, .

154 ea t i t ,
s r ce n ro or on o
 I n d ex 44 5
b r ea d i pi f
1 34 , 1 35 , 1 37 ; r ce o co mmo di t i es u se d fo r , i 2 0, 21 ;
ly y dd i g diff t m t l d f by
.
,
.
,

i n e ar 7t h t 1 c en ur an ur n er en e a s use o r,

8t h
1 t y 37 38 ; l t
c en ur 1 1 a er di ff t t i er en ; na i d o n s, 21 no co n e
pi g d y m g th R m b f
, ,

38 ;
r c es , t 1 no so oo a m one a on e o an s e ore
m f th m
e a s ur e y pi o f e one r ce o S vi er T lli
us ; igi f
u us , 21 or n o
lb a m
o ur , 7 7 ;
as c o 1 1, 1 2 c au s e i dm y ;
co ne one f i t 22 use o n ro

f th l w ig f p i by Willi m t h C
, , ,

o e o f er n 06 o r ce o 2 d duc e a e on
t x ii 35 7 d
,

a es o n , q 3; R m
u er o r , 2 A P o an s or on o,
M di t ti dw l 3; E gl ih p d i Ed
.

e S
err an e an ea , na ons e 2 n s o un n
li g n d t h fi t t b ivi
r o un e rs o e c w d I ar t im
’
3; t h
s T y e, 2 e ro es
li d i se 8 1
,

p d 3;F h liv f Ch
o un 2 r en c re o ar
q t d p t im
.
, ,

M es s an c e, t thuo e as o e oor l m ge a ne s
’
3; t h S t e, 2 e co s
w ki g m or i h p y
n o re th n c ea ear s an p d 3; igi l w igh t f
o un 2 or na e o
d y ear i 75 e ar s ,
‘
h ill i g d p i 3; p
s n
,

s an en n es , 2 ro

Mt l d i mm p t i b t w p d h illi g
.

e a s, as use i n co er c e n or on e een o un s n
i t t im i ;diffi l t y f d p y 3 4 ; th x t
,

an c en es , 21 cu o an enn 2 2 e e ac
w ig h i g yi g x h g bl
.
, ,

e d n an 3 a ss a n 22, 2 m ea s ur e f th o e e c an ea e
df i g 34 35 ; g ld vl mm di t i
,

as u se or co n a e, o a ue f o t co th o es a e
pp lgl t d d pl 3 33;v l
,

and co er as e a en er s , sam ti m e e an a c e, 2, a ue

3 (5 G ld s ee d S ilv )o; m t lli an er e a c of t R m a tim t di

o e es pp a e n co er s ,
mi i wh t t h i v l
n es , n a e r a ue c o n 34 ; ilv s i i E gl
er d 34 ;
co ns n n an

5 3;p i m t l t wh g ld d pp fi t d
,

it
s s s, 1 f r ce o a e a a on e en o an co er rs us e
mi ff t t h t
ne a t v y th
ec s a a e er o er , f or i g i E gl d 34 ;
co n a e n n an

5 4 ;l w t d hi gh t p i f ypi f g d 4 (
,

1 o es an es r ce o m one r ce o oo s, 1 s ee
p i m t l ( G ld d
-

r ec o u s e a s se e o an I t n t ) ;p
er es t ly f t h i ar on o e c t ou
S ilv ) ; q er t it y f b u angh t t o ro u o l t i g pi t l 5 3; p t f t h
a n ca a 2 no ar o e
m k t p i v i l v i t y i divid l
, ,

ar 9 ; e f 1 2 r ce o ar es es s re en u e of so c e or n ua
th th t f th l dp d b t it t i f p p
, , ,

an a o o er an ro u c e, 5 6; t h
2 e su s u on o a er

91 ffi
2 y e i h m cac i d t y i n u an n us r n f or g ld d ilv o an5 7 ff ; g ld s er , 2 o
m l t iplyi g q
u t it y n f i u an o s un an d ilv s mpl y d i t h p
er e o e n e ur
t i i m h i g f f ig g d 5 9
,

c er a n , 2 17 ; d t h tw an e o c rcu c as n o o re n oo s, 2
w hi h t h i q t it y 60 ; p p ti w hi h t h
,

t s an c es ou c e r u an 2 ro or i on c e c r
dp d e en 7 s, d q t
21 an c o n se u en cu a l tig m n y f t y
one o a c o un r
ir se d f ll i p i
an a 8;f
,

n r c e, 21 er b ears t wh l ovl f l
o e a ue o an n u a
ti lity b or f mi hv
arr en n ess o n es a e p d ro 6 ;b
u c e, 2 fit t t d i 1 en e o ra e n
no x i w it h t h t t f
co nne on e s a e o S tl co d by i t d t i
an f n ro uc on o
i d tyi
n us r t y n 8 a c o un r
9; 21 21 p p m y 6 63; p p
a er on e 2 1 2 a er
ff t f imp v m t i dimi
-

y x di vl
, , ,

e ec o ro e en n n m one t c an n o e c ee n a ue
ih i g p i
s n f m r cef t i o an u a c ur es n t h g lde o d ilv i
t
an p t s er re r es en s ,
wh i h m t l c m pl y d
e a s ar e e 5 o e 22 2 65 ; ff t e f i ec i gt l g o ss u n oo ar e a
Mt y p i ff m k w q t i t y f p p m y 67
,

—
e a ers , s ec es o ar er s no n u an o a er one 2
i F n i 34 6
r an c e a s , 2 69 79 2 8 ; d i dv 2t g 2 f sa an a
,

es o
Mili t i i 35 6 ; p p m y i t im f w
.
,

i l t i f 8 6—89 ;
i th
as , ld t w
n e o o n s, a er one n e o ar ,
v l ki d f ii 8 9 ; i f
.

se er a n s o 1 n e 2 8 6 ;t h e c rc u a on o 2 2
di g mi p p y i N t h Am i
.
, ,

i i ty f t t
—
r or o o s an n ar es , a er c ur r en c n or er c a ,

9 6 ; i t im d i Y k
,

190 9 951 1, 1 f 1 n es o 2 87 88 29 9 3; 2 1 2 an n or
l it i b m p t i hi 87 9 ; q t it y f g ld
, , , ,

w th
ar mi e a ec o es rac s r e, 2 2 1 u an o o
ca lly t di g m y 9 9 ; a s an n ar 1 1, 1 2 an d ilv t k f m t h
s er
,

a en ro e c ur
f v i t i d t ib lw y q l t t h
,

o ar o u s c o un r es an i r es , n r en c y i s a a s e ua o e
opp it i t t h t di g m i
os on o e s an n ar es q t it y f p p m y dd d
u an o a er one a e
of R m 93o 9 4 ; vi t
e, 1 i f 1 c o r es o t i o t 89 ; 2 f t t m t th t
err o r o s a e en a

95 ; f G m S yt h i f p p y g
, , ,

1 o d er an s an c n cr ease om a er one au
i 95 ;
an s . 1 m t en s m y pi one f m r ce o co
Mi n es ( l dmt l) H
s ee c o a s an e a s un m dit i o 89 es , 90 ; b 2 km y 2 an one
g i d T ki h h w w k d
-

d p mi m gi 9 3;p p
, ,

ar an an ur s o or e an re u or a o, 2 a er
ii 7 8 y d t v l
, , ,

1 c urr en c t fl o es no a ec a ue
Mi i ippi h m 1 8 3 f g ld ilv
.

ss s s sc e e, 2 o o d an 9 3; s er , 2 on
Md t x k ii 3 wh t th v l f th dp d
.

o us , w a no n as , 21 a e a ue o es e e en s,
M y ttl lt th 9 3; t h q t it y f whi h
.

on e ,
ca d e, sa ,
an o er 2 e u an o ,
c c an
44 6 T he W e al t h o f N at i o n s
be an n u a pl y d i lly my t e m g d m gm t o e n a en e o oo an a e en
t y
c o un r h w d t mi d 303o 34 ; f h m e er m k t 40ne ff 1 o o e ar e s, 1
304 ;i v l f l l i l p li y f ii 7 3 74 9 3
, , ,

n c r e as es a s a ue o an n u a co on a o c o
p d i 9 7 ; ff t B i t ih pit l
.
, , ,

304 (
—
f
—
ro uc e n c r e a s es , s ee e ec o on r s ca a
St k ) ;di t i t i b t w
oc s d nc 9 8 0 5 0
on7 0; i t e d g een , a n 1 1
,

11 s er an e
,

th m v bl g d 37 6 ; l di t ib t i
,

m t f th
—
o er o ea e t oo s, en o e n a ur a s r u on
x p t t i — f g ld d ilv
e or a on o f t k o 4 9 an s er 111 o s oc 12 12
t d 377 380 38 38 ;p i f
ra e, 1, 2 r ce o
,

g ld lv l fl t t i g N vig bl iv imp t f i
,

o d i an s er es s uc ua n a a e r er s , o r an c e o
th th t f th mm di t i
.
,

an a o 8 o 9 er co o es , 1 1

38 ; m 2 ily pl d t h
o re ea s re ace an
,

o th er mm di t i co 38 38 3; P t o l d d es , l d th i 2, as ur e an an c o rn an e r
mpl i t l t iv v l
, ,

c a us e f th o f e co 1 34 36 ;a n t s o re a e a ues , 1 1 r en
i t y f m y 38 3; ly
-

d p fit f p t gl t d
.

s c ar c o one on a an ro o a s ur e re u a e
m ll p t ti l by t d p fi t f
,

s a f th ar o e 36 na ona r en an ro o c o rn , 1
pi t l 384 ; q t it y i v y
c a a 37 ; t
u an d p fit f m n e er 1 r en an ro o as c o
,

t y g l t d 38 5 p d wit h t h f vi y d
, ,

c o un r h w o re u a e ar e o se o ne ar
38 6 t h g ld d ilv d p
, , , ,

e t o an s er s o r e u
i t y m y b dit i Pé g d ti f p g “

n a c o un r a 37 5
e s n a es , u es o assa e . 11

g ih d i t t h p t 38 6 387 P ylv i p p y i
.

u s e n o r ee ar s , en n s an a , a er c urr en c n,
t h e i l t i g m y 38 7
c rcu a i 9 9 ;
n igh t f p im
one
,

2 1, 2 2 no r o r o

pl t f p iv t f mili 387 g i t i ii 7 0
.
,
1 a e o r a e a es, en ur e n,
y l id p i t h t y f P g ld d ilv mi i
, .

m one a u n e t
r e as ur o er u , o an s er n es n , r en

p i r n c es ,38 7 ; f ig w t d t o re i 5 4 5 6 8 3 84n ar s no an ax o n , 1 1 1 1
m i t i d by f d
-

y f th g m t giv t di v y
.
, ,

a n a ne an o es e un s, en c o ur a e en en o sc o er

38 7 39 0 ; t h
-
g t d f e d w ki g f r e a er 55 56 n ee or an or n o 1 1
ll t i g t
c o ec n i ld d y Pi m k i g i 5
r ea s ur e n o a s, n a n
, ,

x h g Pl t h i w y f livi g
« -
.
,

39 1,
39 ; f
2 c o ur s e o e c an e, a o s a o n 1 1 22

4 8 ff ; h w t h vl P ll t x
.
, ,

1 f th
o i 35 3 i
e i 338 339 34 9
a ue o e o a es ,
i f t y m
-
.
, , . ,

c urr en t co n t 450o a c o un r us
b ej dg d 4 0 ; x p
u e f P l w i E gl d h d h ip f
2 e en s e o oor a s n n an ar s o
i g h wdf ydi F i
, , ,

c o na e, o 3 e ra 4; t t t e f Q n r an c e 12 12 s a u e o u een
d E gl d 4 0 4 ; f ig E liz b t h 4 ; f Ch l
.
,

an n an 2 21 II ore n a e 12 o ar es
ll f x h g h w p id ; f J m 4 ; f W il
, , , ,

bi s o e c an e, II o a 1 22 o a es 12 o

; f d p i t 4 ff ; v l li m I I I
, ,

4 21 o e os s, 5 6; f Q
22 a ue a 12 12 o ueen
f ilv d g d d by b t i A
.

, ,

o s er e ra 6 e 7 o un es , n n e, 1 2 12
ii 0 ; d g d t i i v l P p l ti f i
,

1 e ra f a on t n f i a ue o o u a on, ra e o n c r eas e o n
ilv w h f q G t B it i d t h E p
.
,
“
s er , en d o c o n se u en c e an r ea r a n an o er ur o e an
wh en t no ; ff t f th 11 ti i 6 ;i B it i h C l i
12 e ec o e na o ns, 2 n r s o o n es
t xi g d p h ib i ti g N t h Am i 6 ; g l t d
.
, ,

a n an f th ro n o e in or er c a , 2 re u a e
x p t t i f g ld d —
e or a ilv by
on o by t h d m d f m 7 7 ;
o an s er e e an or en , 1, 2
Sp i a n d P t g l an 4 ;i m i or u d by t h lib l w d
a 12 1 n c r e as e e er a re ar
i t E gl d f g ld f l b 7 ;i w h t p p l
,

p t ti
or a on n o n an o o o a o ur , 2 n a o u o us
f m P t g l 45 47 ; f
ro or u wh t a i t 49 -
or a n es s c o n s s s , 1
p g ld d ilv P t g l f ig i i
,

p ur o se o im an s mm er ar e or u a ore n co er c e n
t d 47 48 ; p t iv v l ff t f p h ibi t i g
.
, ,

p or e r es ec e a ue e ec o ro n
i d d i d g ld d x p t t i f it g ld d
, ,

o f co ne an th un c o n e o an e e or a on o s o an
silv i G t B it i 4 8 4 9 ;
er n r ea ilv i i r4 ;t ty
a n, f m s er , 12 1 r ea o co
d 4 4 ; i mp
-

i g ig g 4 9 w i t h E gl
.
,

c o na d th e an m e se no ra e, er c e n an or

54 ; d ty i g 5 ; d t fi f g ld i t E gl df m
,

u on co na e, 1 an a on o o n o n an ro

k f E gl d 5 5 5 ; 4 5 4 7 ; di v i f th P t
,

th B e an o n an 1 sc o er es o e or u

57; l iz t i f B il
- -

i i g t h d mi t i f i
,

r az
ra s n e g
en o na on o co n ues e , co o n a on o
x p di t f li g v l p w 67 ; it , ,

an e e en it or c o n c ea n s na a o er , s
p bli b k p t y 4 ; d l t
u c an ru mi t k c l i l p li y 12 a u er a s a en co on a o c
ti gm t t i 74 ; b l t gv m t t b
, ,

on d an fau i en a on o co n , a so u e o er n en es a

4 5 ;p p 1 m ay i th l i er lih d i i
o ne t C l n i 8 3; ff t e c o o n es , s e n s o o n es , e ec

4 3; m pl y m
2 e t f g ld o d f th m en p ly f l i l t d
o o an o e ono o o co on a ra e
i lv i t h C l i 4 4 4 6
s er n e 06 ; t
o o n es , l i m Af i 2 d -
2 o n, 1 i s c o o n es r c a an
M ono p ly ff t f i 5 4 5 5 ;
o ,
e ec th E t o 3 ,
.
,
an e as ,
1 1
 I n d ex 447 1

P t fi
os o th c e, m t il p e, p v ty 9
a er c an 0; f t h t e f ro o er 21 22 o a o
t i mm di t i i p p
-

j t ii 300
, ,

ce c er a n co o es n ro or
i d h p ti d iiv
.
,

P t t
o a o es , th e n cr e as e t m c ea n es s on o c o rn , a ore ec s e o n e,
of i 69 ; t h i l t iv t i m
e r 0 cu ; i i a f onmm di t i co 22 221 r se n, o co o es ,
p d w it h t h t f i p i y w d f p bli
.
, ,

are d th a o r ce an e e c un ar re ar o u c
wh t ea45 46 ; t h i 1 t i t iv 1 v t h ld b e r nu r g l t d e s er an s s ou e re u a e
q lit iua 47 ;
,

es , why t h i
1
,

di g t t h
r ea s o n f 3; e r ac c o r n o e c a u se o 22
l t iv t i i di g d 47 t ifi i l i i i d by
,

cu a on s s c o ur a e 1 ar c a r se n, o c c as o n e
P ou l t y i i p i f i 05 06
r r se n t x
r ce o m di t i g t t h p
2
,

2 a es , ore s r es s n o e o or
th l i
.
, , , ,

07
2 t 4 ;d i mi an a n a ur a r s e, 2 2 nu

Pi ec e w k -
m kor p 1 73 re ti ar s f p i u i m
on , f t on o r ce n a n u ac ur es
wi g t imp v m t
.
, ,

74 4; o n o ro e en s, 22
P ra gm t i S t i t h ii 8 6
a c an c m on, f t e, i w hi h m t l 2 an u a c ur es n c e a s
th i p i ly m pl y d l t hi g
.

P i
r ec o us t s o n es , e r r c e n e ar 5; ar e e o e 22 c o n
t i ly m d f w g 5 ; h
,

en re p a d e m u f t
o a es 7; an an u ac ur e , 22 o s e, 22
p fit i 5 8 ; t h i b d
ro 1 w ll e r 7 a 8; i un i th an c e oo en ,
’

22 22 r se n e
ld d d li t t l t t h w l t h pi f p i ff d m
.
, ,

w ou a e o e ea r ce o one s e c es o oo co
f t h w ld
o e 58; or f d p 1 t d f by f ll i
c au se th o e en s a e or a n an o er ,
m d f 3; p i l p d
,

an 59 or, 1 f 22 r ce o an n u a ro uc e
P mi m
re u m f t
s , s ee d ivid i t l f i t t h p t
an u a c ur e s es se n o r ee ar s ,
P ir c e, l d mi l i 6 ; f
r ea an 30 ;
no na ly t t d t h t 2 o 2 err o n eo us s a e a
lb l d mi l i i f p p y g
.
,

a o ur ,
9; 2 r ea an no m na n n cr e a s e o a er one au
p p ti t th m t p i mm di t i
,

ro or on 3 ;o one an o f 89
er , 2 en s r ce o co o es , 2
y p i f g d 3 33 4 90; p i f l b th
,

m one r ce o oo s, 2, d 1
°

2 r ce o a o ur an o er
mp p t 4 45 mm di t i h w ff t d by
,

it s co t o n en ar s , 2 -
co o es , o a ec e a
m k t p i g l t d 49 i f li f
,

ar h w
e r c e, t o th
re u a e ax on e n ece ss ar es o e,

5 0; p i mm di t i 4 09 4 0 ;b ty xp t t i , ,

f ll
r c es o a co o es 1 o un on e or a on
lly g vi t t t t h d t i th p i f
,

c on ti n ua f
ra t a e o e o c o rn en s o r a se e r ce o
l p i 5 ;fl ti ii 8 ; m y p i f g
,

t
n a ur a t r c e, f 1 uc u a on o one r ce o c o rn re u
d p d t v i ti i d l t th t f th h m i d
.
,

e en en on ar a o ns n e a es a o o er o e n us
m d an d v i ti an i th t i ar a d f l b
ons 0 ; i n e r es an o a o ur , 1 11 r se
q t it y b gh t t m k t 5 ; mm di t i g
, ,

u an ro u f i o ar di e 2 o n co o es a s c o ur a e
ti f ll h i fly w g i d ty
, ,

fl t uc ua ons a m t t c e on ; f a es en o n us r 11 12 o
d p fit 5 ; h m t f g l ti g th p i f
, ,

an ro 2 en an c e i
en o re u a n e r ce o c o rn n
m k t p i t im it y 4 ; g i g
.

ar e f 53 54 ;
r c e, c a u ses f o es o s c ar c 2 en r o ss n
h ig h t d l w t l p i d f t ll i g f p p l
, , ,

es ant o es n a ur a r c e, an o r es a n o c o rn , o u ar
54; m k t p i ar ld m e p j di
r ce se i g 33 34 ;
o c on re u c es c o n c er n n
ly b l w t h lp i f t d g d i d by , ,

t i n uo u s t e o fm e n a ur a r c e, o an u ac ur e oo s , r a se

55 ;p i i w it h i r ce r ses f t w g 34 7 ; f
n cr ea s e i o ax o n a es , o n ec es s ar es ,
w g a 77 ;p i es , f mm di t i r ce w g o g l t d by 35 ; f
co o es a es re u a e 2 o
ff t t h p fi t f t k 04 ; l x i w g
a ec s e ro s o s oc ff t d by 1 u ur es , a es un a
,

ec e
r ed d by mp t i t iuc e ; 35 3; m
co ep ly ff t f t on ,
,

1 12 ono o e ec o ax o n ,
,

g l t d by t h t d b 37 4 ; t x b id
,

h w o re u a e e t m
ra d e e a es es es c us o s an
t w t ween d ot y n 3 ; an x i ff t i g p i f g d
c o un r 1 1 e c se a ec n r ce o oo s,
f p vi i th g d ,

o ro d s on s 37 5 an o er oo s
t d i i t ti m P m g f
.

r a e n an c en9; t t es , 1 2l w 34 ; r en 11 o en 1 ur e , a o 1 2
ff t d by h ig h t il t h l q
.
,

a ec e l w f m or o t o co en a s e n a ur a c o n se u en c es
l h w g f 34 ; t h i b dit y i t h
,

m d it i o 3 ; f es , 1 2 o c o a s, o re u o 2 e r a s ur n e
l t d 5 3; f m t l p p 34 3;
,

a e 5 1 2, h w 1 t
o t t f E
e a s, o r es en s a e o ur o e,
ff t d 54 ; l w t b t ti d by t il t
,

a ec e53 1 d 1 o es an o s r uc on c au se en a o
gh t f p i m t l 5 6 ti g f l gl
, ,

hi es o th g
r ec o u s e a s, 1 34 8 ; e r an n o on ea s es ,
t d t mi d by t h t f gh t f i P ylv i
,

57 ;
1 no e er i ne a o no r o n en n s an a ,

y
an th mm d it y
o er 57 ; f co 70 o 1 o
p i t
r ec o u s 58 f wh t
s o n es , P dig li ty
1 p bli my i 30
°
,

o ea ro a a u c en e 1
i f m ti v i 304 t h p i ipl w h i h p mp t
.
, ,

n m
or 6 ff ;er es , 1 1 con er s o n e r nc e c ro s
p i r ced m k t p i an 66 ; f ar t 305e r c e, 1 o o
th f p d P d p t iv v l
,

t h e t r ee 98
so r s o ro f
uc e, 1 ro u ce , r es ec e a u es o ao
ff ; p i f g ld ilv di g t p w ,

d
— f fl di g
r ce o o an s er no cor n o o er o a or n
p f f
roo t h t io w l t h e na t i on s 6 0
’
6 ;t h l ea f or r en ,
. 1 1 1 r ee c a sses o ,
 44 8 W eal t h of N at i o n s Th e
h w ff t d by h p g
o ec e f W t I di C l i t
t h i e ro ess o o n es an n
e
r o es n an
imp v m ro 9 8 ff ; ie i E gl
en t , d 8 w g d 1 t ik r se n n an 2 ; a es o no s n
pi f r ce o y m w i h 83
t o s ec ur e c o
n e c ess ar ff t f q i i i f t ;e
,

ec o ac u s t on o
im p v m l iv i y w b h f
, ,

pl et e ro e d
en t an cu t w t
a ne err t o r or ne r an c o
i
t on o f h y 9 ;wh l
t e c o un t r , 2 0 do e 83 i d by d im i t ra e on ,
,

; r a se nu ‘

pir ce of l div id i l f
an n u a , es i f
t se k 8 ; ff d b y t on o st o c 4 as a ec t e
i h p
n t o t r ee 3 p
ar t s , 2 0 m h w l h
ar t e d p p l i f t e ea t an
,

o u at o n o a
pl y d f p d iv p f
o e or ro uct e, ar t or y 84 8 5 ; d g c o un t r n e at an r o ss ,
p d iv l b d by h w l h f ,
, ,

un r o u c t e, a o ur , 96 98
2 862 ; ff ;a s a ec t e t e ea t o a
-

p p i b w
ro ort o n et h p
een t e t y
ar t s s o 86 3 ; p p i c o un r 1 0 ro o rt o n
m pl y d i i h d p b tw i t d l p fi , ,

e o e n r c an o o r c o un e een n er es t an c ear ro t,
tr i 98 99 v l
es , 2 f l 8 7 ; ff
2 d by di g bl
; a ue o an n u a a ec t e s a r ee a en ess
p d i d by p d iv f m pl ym ff
,

ro uc e n c r ea s e 9 d ro uc t e o e o en t , 0 ;n o t a ec t e
l b a l 3 6 3 7
o ur a o n e, l by h m 0 w g 9 0 ; an n u a t e sa e c a u s es a s a es , 1,
p d ro f l d d l b
uc e io 93 9 an v y wi h an
,

i y a o ur n 4; ar t c er t a n t
E gl d g h f m ly i y f
,

n an r e a t er t 99 ; an or er or un c er t a nt o r et ur n s ,
pi t l l d by g bl i t
,

307 , 309 ; c a a en t at n er es t a ff ec t e a r eea en ess or

eq iv l t tu a en f
o an di g bl ass gm t
i f th b i
n en o a s a r eea en ess o e u s n ess ,
p ti or f th on o e d t he i k
an n u a l p d it y wit h
ro u c e, an r s or s ec ur

3 5 ; 1 th h
as e f s w h ih i
ar e t i tt d ti d
d d 9 9 ;m
es ne or c s a en e o re o n
re pl i g pit l i
ac n ca th a l v l t h w g i t h diff t
n cr e as es , e a e e an a es n
,

e er en
m i d it on e t i n 3 5 ;
er e s t d 00; pp t p fi t l y
n c r e as es , 1 ra es , 1 a ar en ro on
re v f ll t h i h bi t
en u e o a t f lw g
e 0 ;
n ap t iv p an s o r ea a es , 1 1 r es ec e ro
a t y i p
c o un p ti t th
r n fit ro f t i l d wh l l t d
or on o e s o re a an o es a e ra e,
v l f th a ue o l p d 3 7; e ann u a 0 0 ; v y w it h p i
ro u c e, f 2 1 1, 1 2 ar r ce o
b l a an c e f l p do d
an n u a m m d it i f whi h
ro t k i
uc e an co o es or c s oc s
c o n su mp t i 4 4 0 4 4 ;t h l i
on , d 04 ; d d by mp t i 1 e c ass u se 1 re uc e co e
f p d di g ti ;l w i g
, ,

fi ti ca on o ro u c er s f i t w
ac c or n on, 1 12 o er n o n o n
t th y t m f th F h i t w g 6; h
i 5 8—66 ; v l
o e s s e o
y e r en c r a s es c o un r a es , 11 s ar e
p h il p h o so i er s , f i th 1 p i f m t l 54 ;
1 a ue o n e r ce o e a s, 1
l p d dim i i h d by f th th p t i t whi h
.
,

o f an n u a ro uce n s e on e o e r ee ar s n o c
t
r es r a n i t t d 8 0; v
s on ra th pi fe, 1 l p d re en u e e r ce o an n u a ro uc e
o f th t y d p
e d
c o un r p div i i t l f 30; t f d
e en s on ro n es se 2 ra e o o es
d l d 305 ; t i d f ll w i t h t h p
, ,

uc e f th o e an t ax on : no r se an a e r o s~
t yt h d d l i f i ty
,

3 8 3 e, 1 21 p i t er y an ec en s o n o so c e
-

P f i mp t i t i 3 ; f ll w it h mp t i t i
,

r o ess o n s , th ie, co e on f n, 2 1 a s co e on o
i 8— 011 12 pi t l 3 6 p p t i b ca a s, 1
°
ro or on e
P f i l t i g pi t l d p fi t ff t
.

r o es s o n a d a c o rs tw an s n ers , een c a a an ro as a ec
p i ipl r nc whi h t h i
es o n w d d by i
c d q t it y f
e r re ar s e n creas e u an o
ar e f d d i 95 o un e ilv f mm di t i 3 7 s er , or o co o es, 1
P fit g l t d by d ifl t 3 9 ; h w ff t d by m p ly
.
,

ro s, re u a e er en 1 o e ec e ono o
p i ipl t w g i 4 3; t h i t di t ly t x bl
,
r nc es o iia 09 ; es , 3 9; e r 1 no r ec a a e, 2
vl m d i di t ly by t x f p ti l
. .

a ue e as ur e th n r ec m a es on e, o ar c u ar e
lb a o ur ,
44 ; f th mp one o t pl yn t 334 335 ; t h
e co t ill o n en o r en s, e a e,
p t f p i 4 3 4 4 ; ft m t imp t t t x p fit f
,

ar s o r c e, o en con os o r an a on ro s o
f d d w it h w g 4 7 ; t i
o un e t a k 335 ; ff t
,

es , t d con rd s oc e ec on ra e an
b t l g ly t t h v l f m
u e ar e o g i lt e f t a ue o 337 338 ; co a r cu
,

ur e o ax o n ,

4 8 ; ff t d by fl i t t ff t d by t x 339
,

m di oti es , t a ec e uc u a n er es a ec e a on,
ti onsi th m k t 5 ; v
n e P p ty
ar x t iv
e f v bl2 ne er ro er e en s e, un a o ur a e
i k b l w th i t l t f
s n e o t
e r n a ur aimp v m t i 34 4
,

ra e or o
,

ro e en
g t l gt h f t im 5 5 ; P vi i pi fl w N th
.
,

a r ea en o e, ro s o n s, r ce o o er 11] or
ff t d by p i f p vi i A m i t h i E gl d i 6 ;
.
,

a ec e r ce o ro s o n s, er c a an n n an 2

75 ; i d t p i f G t B it i
.
,

f t
n c r ea s e k t o s oc en s o r ce o in r ea r a n
l w 7 8 ;h ly fl t t i
o er , o ur f p i f ff t p i f l b
uc ua ons o r ce o a ec s r ce o a o ur ,

79 ; p fi t k v y wit h d p fit
, ,

f t
ro s o 74 76 ;
s oc d t ar 75 an r en s an ro s,
m k t f i t t 7 9 ;h v P bli w k d i t it t i
,

ar t e ra e o n er es f a e u c or s an ns u o n s, or
b ee n dimi i h i g i Hn s y f ilit t i g mm
n s nce
,

ii ;en r ac a n co er c e, 211
VI I I t i m 8 0 ;l w i H ll d xp d tb d f y d
.

’
s e, o f n o an e en s es o n ee no e e ra e
8 ;h ig h
1 i N t h Am i er n d by t h p bli
or
,

v er c a a n ;
,

e
,

u c re en u e, 212
 I n d ex 44 9
x t i f t ll
e ac on o 4; v o i i p p ti
s, 212 t th v l
-
21 fit re e s n ro or on o e a ue o s
n uet b d iv d f m o e 4 er 5; e l p d ro 3 7; 21 l 21 an n u a ro u c e, 2 ann u a
b lik ly t i f m t ll v i ty i q l t
, ,

a u s es e o f
ar s e ro o s re en u e o a so c e s e ua o
b mi g ec o n f v a th
s o ur c e x h g bl v l f t h o re en u e , e e c an ea e a ue o e
215 6 ; h ig h 21 d i F wh l ro a lp d s f int i r an c e o e an n u a ro uc e o s n
und t h di t i ,

er f
e th d t y 4 00 ;
r ec f th
on t m ; o e us r o e c us o s

x t iv p w
e ec u 6 e 9; od i j d by t x
er , 21 t i i g im
21 an n ur e
,

a es r es r a n n
i Ch i 7 ; lw y b tt 4 6 ; f Ch i
,

n n a, 21 p t t a a s d e er o r a io n , 1 o na an
m i t i d by l l E gyp t
”

a n a ne p a ii oca f th or ro o e
v Emp f Ch i
.
,

i il
v nc a 8 re 9; d
en u e , 21 7 218; f an er o r o n a, 21 21 o
j i t t k mp i v ig p
, ,

o n s oc 4 3; h w
co th an es , f E 2 8 o e so er e ns o ur o e, 21
-

t o m t xp ee f 97 99
e p bli i w h t t h f d f
en s e s
—
o 2 -
2 u c, n a e un s o co n
l d d i i
,

( s ee a so u n E t ) er t 99 30 ; f t h
uc a C on t f s s 2 1 o e an o n o

30 ; f H mb g 99 ,

B ern e, 1 o a ur 2
ti ylv i 30 30 ;
, ,

R ma i i hi t
uz z n Di s 30 ; f Pr ea se on s 1 o en n s an a , 1, 2

eas es o f A ti fi i 73 ,

r l d
c ers , f f th m i an as a s o ur c e o or e a n
R f m ti Th ii 8 7 ff ;L t h
.
,

e or a on , e,t f th
2 St t 30 305 ; u er en an c e o e a e, 2 -

d t h Ch h f E gl d 89 di y f G t B i t i 303
.

an e ur c o n an 2 or n ar o rea r a n,

9 ;C lvi 9 0 ;C h h fS t 304 ; v f mC w l d , , ,

2 1 a n, 2 ur c o co re en u e ro ro n an s
l d an 9 9 ; P t t 2 1, t 305 2 306 ;
2 f p iv t
ro es an s o ur c e s o r a e
Ch h f S w it l d 9 5
ur c
,

es o v 306 ;p t f
z er an i i gf m 2 re
,

en u e, ar o ar s n ro
k t d i t ly t x bl 3 9 ;
, , ,

2 96 t s oc no r ec a a e, 2
R gi t t i d ti d w f m d ti f t m ,

e s ra i i
on , u es o n , ra n ro u es o c us o s,
w h m t h y f ll 34 4 ; gi t 364 ; f q t ly dim i i h d by
.

on o e a re s ra re u en n s e
ti mm v bl p p ty h igh t x t i 364 ; m di
,

on i on o a e ro er a a on, re e es
g i t dimi t i f d m g
,

34 5 a a ns nu on o an s u
R ligi diff t t f ii 70 gli g 365 f m pi i t liq
,

e on , er en s ec s o 2 n ro s r u o us uo r s
ti W 1 1 p li t i 369 ; f m m l t t
.
, ,

2 7 ;i t 1 370 37
1 ] c s, ax , 1
°
s c o n n ec on o ro a

74 ; t l ti id d by t x l x i t k t f th
,

2 73 2 o er a on n uc e a es o n u ur es a e ou o e
m l t iplyi g p k t f t h p pl i p p
,

th e f u t 74 n o s ec s , 2 oc e o e eo e n ro or
l f th p ti Wh t t h y b i g i t
,

7 5 ;m
i h 7 5 —77 ; g l it y f m l
d th t th
—
2 ora s o e o or an e on o a e r n n o e
r c 2 2 p bli t
r e u ar y 37 7 38 ; l w o ora u c r ea s ur 1 a s
m ll f i F 38 3; i p t
, ,

i thn e t s 77 ; S t t
a er sec 38
s, 2 a e o n r an c e , 2, n ar s
re m di f e t ies t
or sec f I t ly 38 3 38 4 ; v
ar an f
ex r av a o a re en u es o

g v ig F d G
, ,

an c es , 77 78 ; t h 2 2 t B i
e t i so m er e n r an c e an r ea r a n co »

t bli h d h h 78 p d 38 7 ; p bli m t g g d
,

an d an es a s e c ur c 2 ar e u c, or a e

39 5 ; m t g g t x
, , ,

2 80 39 4 or a e on a es
R t wh t t it t t i 4 4 ;i 39 5 39 7 ;b d i i gf m ,

en a i c on s t u es s ur en o n , ar s n ro
v l i di t ly m d by y
-

th m th d
.
, ,

a ue n r ec 39 7 ; m
ea s ur e es e e o s, on e
l b 44 ;
a o ur , f th mp one ot b wd p e co i t i 39 8 o n en o rr o e u on an n u es ,
p t f p i 44 ; ft
ar s o r c e, 4 00 ; mi ppli ti o f S i ki g
en con sa ca on o n n
f d d wit h w g 4 7 ; t i
o un e F d 4 03; i d f m p d
a es , con r un r a se ro ro uc e
b t l g ly t t h v l f m
u es ar e o f f e m tg g d t x
a ue o co o r ee
,

or un or a e a es
m di ti
o 48 ; l es ,fl t d th hi d f t h
ess a m l ti
ec e f an n ers ur er ac c u u a on o
w g a d p fi t by fl
es an t tiro pit l 4 07 4 08 ; t w
s uc u a igi l ons ca a o or na
i t h m k t 5 ; ff t d by f 4 09 4 0 ;lib ti
, .
, ,

n e ar e 2 a ec e f s o ur c es o 1 er a on o
p i f p vi i L d p bli l w y b gh t b t b y
, , ,

r ce o 75 ( ro s o n s, s ee an u c, a a s ro u a ou
an d H d T x ) o u s e an b k p t y 4 ;imp ibilit y
a es a an ru c 12 os s
R v th t h igi l f lib t i g p bli f G
,

e en u e, e r ee o r na t so ur c es o er a n u c, o r ea
of i 4 6 ;i f i th
n cr ease o B it i 4 5 4 6 p ibl m
n c r ea ses e r a n, 1 1 o ss e ean s
°

dm d f w k 6 ; g gm t t i f 4 6 ; t i
.
, , ,

e an or f
or ers , 1 r o ss o au en a on o 1 c on r ~

l i t 4 6 4 7;
,

an d t 5 ;h w j
ne t ly t
2 1 m b ti
o f us o co u on o c o o n es o, 1 2
p t g q i it i f E t I di C m
o

5 4 ;i w h t
, ,

u e d t r o s s an f ne 2 n a o ac u s on o as n a o ‘

i t 5 4 5 6; p d p y t 4 8; id t i
,

i t co n s s s, 2 -
2 un f ro uc an o, 2 cons er a on o
t iv l b m i t i d by 9 7 ;
e a o ur f th m
a n a ne f gm t i g 2 ur er e an s or au en n
p p ti b tw pit l
, ,

ro or ond e 4 9 4 30 e en , an ca a 2
g l t p p t i b t w i Ri it p i mp d wit h t h t
, .

r e u a es ro or on e een n c e, s r ce co ar e a
d t y
us r d i dl 30 ;t h t
an f f
en es s , g i 4 4 3; u pl f 1 a o o su ar , 1 2, 1 s r us o z
ll t h i h bi t t y p fi t b t i d f m it lt iv
.

a t e f n a an s o a c o un r ro o a ne ro s cu a
4 5 0 The W eal t h o f N at i o n s
t i on , 1 45 r ea s o n w h y r en t o f r ce i by t h p m e d p
oor lw an an o or a s
field s g l ht f
c an n o t r e u at e t a o i g i 3 8
c o n c er n n 12
,

12
l d 45 ; b d
-

th lv G ld d S ilv
.
,

o er an f 1 a un an c e o Si er , s ee o an er
t i wh g w S i ki g F d Th ii 39 8 ;
,

f d i n c o u n r es un
é7
co er e ro n, n n e,
ppl i t i f 4 03
.
,

I a ca on o
R m m
o yfi t i d i i
e, one rs co ne n, 21 Sl v y i
a er i t E p ad i
n an c en
,

ur o e n n
d 3 4 t h W t I di l i
.
,

3; R m
2 A o P an s or on o, 2 2 e es
a C n i 344 ; n o o n es ,
pp t h m f v l i l t t im p 34 5
, , .

co er e i e as ur e o a ue n n a er i E es n ur o e,
g Sl v w k d by t h p
,

i 8 4 ;l w
u s ur i
34 ; y n, a c o n c ern n a es , or one no so c ea
l d ii 5 5 ; d t i i 5 8
an in e uc a on n, 2 as t h t p f m d by f
a er o r m i e
,

r ee en ,
f l tt 34 6 ; t h i w k i t h
. .
,

6 2 67 68 ; m
1, 2 2i en o e er s n, e r or n e
g lly t h Vi g l i 8 4 34 6 ;t h i
,

en er a 94 ; t h eac er s , 2 e su ar c o o n es , e r con
dit i b t t d bi t y
,

im
c es H di t t m
a i 34 0 ;
er e a u n, on e er un er an ar r ar
b k pt y d d g d t i
an ru c f an e ra a on o th an f g v m t 84 8 5 ;
a r ee o ern en
i g i 4 5 ;l w f b li h t f by Q k 34 5 ;B ill f
, ,

co na e n, 1 a s or a o s se r ee ua ers , or
i gd bt i 4 4
n e s n, 1 th i m n ip t i
e r e a 34 7 c a on ,
R y l Af i
o a C mp y ii 9 30
r c an o an 22 2 S m gglmg u 364 365 37 9
11
R m t d i ii 7 6 p t x
. .
, , , , ,

u ra e n, S oa a 35 5 o n , 11
i ty th f w h i h giv
. .
, ,

S oc e e o ur c a u s e s c e
S il p y f i 98 i t t h p i it y f m
,
“
a o rs , a o r se o e su er o r o so e
S lt t x ii 35 5 v t h s ii 00 03;t h
.
,

a a on, m en o er o er 2 2 e
tl d w g i i 68 8 0 9 8 ; b gi i g f i q lit y 03;
. .
, , ,

S co an a es n, e nn n o ne ua 2
d f m l i 7 5 77
.
, , , ,

tra e of it t i 8 0 ;t h C t t
n er es n, e o er s tw o co es o o ra s n 2 -
2
ki g k it t i gi 06 S ldi p y f i 6 4 i 68 ; di
,

f 05 ; t
o 1 s oc n n n n 1
°
o er , a o n 1 1 or n
p i i g 06 ; t m f p
.
, , ,

d
an s nn n 1 er o a ar y p y f 97 a o
p t i h ip th S C mp y
, ,

r en c esg 0; di ffi 1n , 1 o 11 no S ou ea 3
o 33 an 11 2 1 -
2
lt y f t t l m t i
.
, , ,

cu o se e en n, non
iz f b d i
a ss e o 9 30 ; r ea n, 12 1 S v
o ig x p
er e n, f (
e A my en s es o s ee r
ch p ea f b t h n es s m t i o u c er s
’
,

ea n J t i P bli W k t
us c e, u d c or s, e c an
,

t im 35 ; h ig h h h ii 7 8 ff
.

t a one t fe, 1 r en o th e c ur c 2
l d l d i 37 ;t h t Sp i l i mp t t i
. .
,

en c o s e an s n, 1 e o a en a n, it s an n u a f or a on o
b d t i 4 6 ; t i mb i
r ea e a en n 1 er n, p i r ec o u s m t l i e a s,
l mi f ig mm i 37 ; ff t
.
,

48 1 49 ; 1 i h w coa n es n o ore n co er c e n 2 e ec
w k d f l d mi i mp d by g ld
, , ,

ii —4 ; t l i
or 5 ; e t 1 1 r en o ea n es of th t e ax o se on o
v i pi d ilv
, ,

i
m k t p i
n,54 ;
ar
1
f e mm di t i
con
i
r ce o
d er s o n
co o
r ce
es
an
n,
an

59 6— 65
s
2, 66 ; i
er ,
t mi t k
. 12 1
s
i s c o o n es,
s a en
66 ; p i l i l p li y 7 74 ; b l t
,

1 f i
r ce 7 3; do c o rn n, 1 an co on a o c 2, a so u e
fl b
o 7 3 7 4 ;d iy w k i
a o ur , 1 1 a r or n, g o ver nm t t bli h d i
en it es a
,

s e n s
08 ; f ll f th p i li l i 8 3; ff t f t h m
,

2 a f w o e r ce o oo n, c o o n es , e ec o e o
6 ; ff t
21 f th
e ti
ec s o f w e er ec on o ne no p ly f o l ilt d o co on a 06 ; ra e on, 1
b ki g mp i i 6 6 ;
an n co an es n 2 1, 2 2 th Al
e l f 38 ; p bli
ca va a o 1 u c
g t d by t h d bt 4
, ,
s h
c as t a c c o un s r an e e e s, 11
b k i 63; dv t g f t
an s n, 2 a an a e o o S t mp d t i
a -
u
34 es , 11
34 3; wh m 2, on o
t h h t 64 65 ; t h y f ll 34 4 ; d di
.

S
‘

co m c er c an s , 2 2 e a d o n c ar s, c e, an
ff t
e ecth S t h b
on k f e co c an
,

s o ne w p p s 34 5 ;
a
,

ers , li on c en c es,
i i g t l g
ssu n q t it y foo ar e a u an o 34 5
p p a m er y 67 69 ; t h i one 2 2 e r St t ta u e o f L b Th a i 6 o ur er s , e, 1 2
f P vi ii 86
« -

ti dv y 70
.
,
~ c au o us a fm an c e o one 2 St t ta u e o ro s o r s, 2

7 ;m i t k ff t f b ki St l b w t i 34 7
.
,

2 2 s a en e or s o an n, ee o t e n an s,

li v x i t i g di t St k i ip
.

t o re e e e 79 s n s r ess , 2 oc i i
n cr ease n, n cr e as es ro
8 ;p p
2 2 ay i 87 8 8 ;
er c urr en c n, 2 2 d ti
uc
,

p w fl b
ve o 77
er o a o ur ,
pt i l l i t d i t th 7 8 ;i i w g
.
, ,

o ona c a u se n s er e n o e f
n c rea s e o d r a s es a es a n
t
no f th b es ki g mp i
o e an n co an es l w p fit 78 ( P fit ) ;
o er s ro s,
,
s ee ro s
i n,90; t l b w t 2 t i
s ee -
o en an s n, m q i d f t di g t w
o re re u re or ra n i
n o n

34 7 ;Y m y i 34 8 34 9 ; t
eo an r n, r en th i
an t y 8 0 ;l
n c o un r q i d ess r e u re
fl di t t im 364 ;p i h i S tl d t h i E gl d 80;
, ,

o an n a o ne e, ar s n co an an n n an
h l i ii 66 67 ; h h f k w it h ll p fi
,

sc oo s n, 2 2 c ur c o
g t
r ea t s oc m t s a ro s

9 ; v f t t h m ll t k
.
, ,

9 2 1, 2 f 2 95 re en u e o 2 i n c re as es a s er an s a s oc
S t tl m t di bt i i g wit h g t p fit
,

e e fli lt y i
en ,
‘
cu n o a n n r ea 8 3; ro s, c o n n ec
 I n d ex 45 I

ti on o fi t i wit h i d t y
s n c rea s e S mp t yl w i 7 n us r u u ar a s, 22
8 3; ff t q i it i Sw d th i l i ti
.
,

e f ec o f w ac u s on of N w ne e es , e r c o o n sa on o e
t err it y or w b h ft d
or n e J y ii 68 r an c o ra e erse

8 3 8 4 ;dim i ti f l w S wi t z l d t x t i i ii 33
.
,

o n, nu on o o er s er an a a on n, 2,
w g i p fi t 84 ; it
.
, , ,

a d
es an r a s es 334 ro s, s
f r ee i l ti l c rcu a fi t d by on es s a ec e
c or p ti l w th th t f T l t
ora on a s, t l lan diff i a o a en s , n a ur a ess eren ce n,
l b m l ti th f i
,

a o ur , 3; 12 f ac c u w w u a 4 on o an e ar e a ar e o 1
y p vi divi T ll g l vi d i E gl d d
.
,

n ec ess ar t th re o us o e a a e, as e e n n an an
i
s on f l b o 4 a 4 ; di o ur , F 2 i 34 9 35 0 ( T ill )
1, 2 2 s r an c e, s ee a e
t i g ih d i t p t 4 3; T ill i 34 9 35 0 ;m t im p t nt
.
,

n u s tw
e n o o ar s , 2 a e, os or a
th p t i i t w h i h divid d p fi t f S t k ii
.
,

ree or ons t
n o th c e ax on e ro s o oc

4 5 ;t h t q i d f imm di t l vi d
.
,

2 a re u re 335 336 ; m or t f e a e a o un o as e e
mp t i yi ldi g v i F gi
, ,

c o n su on, e 336 ; ff t
n n o re f en u e n r an c e , e ec o on a r
2 45 4 6 ;fi x d
2 pi t l i ti g
e ca lt 337 338 34 7
a cons s n cu ur e
,

f f ti l T x T ll g i 34 9 35 0 ;p g
, , ,

o o ur 46ar 47 ; d
c es , 2 2 an a es , a a e, ass a e,
i l t i g pi t l mp d f p t g l t g t ll g
.
, ,

c rcu a n ca a co d o se o on a e, as a e an s a a e,
f o ur p t 47 48 ; t k mar s , 2 35 2
,

35 3 ( l s oc d T d e 2, s ee a so un er ra e

pl y d f p j ym t C l i ) ; m x im wi t h
,

o e t or r es en d en o en or an o o n es a s
f t u ur e p fi t 4 9 ; v i if ro 2 g dt ig con l ii 307 309 ;
ers o n re ar o, n en er a -

d i t t iv 8 5 8 6 ;p t t fl d
.
, ,

d ea n o ac e, 2 th 2 m t f ar on e r en o an a s s es s en o
d f m i t i i g p d t iv i E gl d 309 y
, , ,

u se or a n a n n ro t
n uc f it e, n n an
°
cons a c o s
p t p d t iv l b v l ti v i ti f
,

ar un ro 96
uc e, a o ur , 2 a ua on, ar a on o

98 ; p p ti b tw p t wit h v i t i
,

2 ro or on e f
een t m ar s ar a on o r en co
m pl y d i i h d p m d d by mi t
,

so e o e n r c m an o or en e so e ec o n o s s,
t i
c o un r es , 2 98 9 9 ;q t it y l t 2 3 3 ;l d t x i V ti
u an en 1 1, 12 an a n en e an
t i t t —h w g l t d 3 4; i t y 3 ; y t m f d mi i
,

a n er es o t re u a e 1 err or 12 s s e o a n s
q t it y f t b l t t th p v ti
, ,

as u an o t ti f o e en f a ra on or e re en on o un
i t t t ity d m d ti g f
,

itn t i
er es th n cr e as es , e n er es c er a n an o er a n o ex
d i mi i h 3 6; p fit f di p bj t i t
,

n s es , 1 3 ro 3 4; o en s e, 12 -
1 o ec on o
mi i h wit h mp t i t i v i bl l d t
,

n s es f co e 3 4; h w
on o a ar a e an -
ax , 1 o
ca pit l 3 6 ; d g m t f
a s, 1 t bvi t t h d iffi l t y 3 4
er an e en o o o a e e cu 1
th e t l di t ib t i f by
n a ur a 3
s r l d t u on h w o d an ax, o
,

a s s es s e
,

m o nop ly ii 4 9 ; v o 12 i P -
i 3 6 ; i S il i
12 re
,

en u e n r u ss a , 1 n ec a ,
i i g f m divid it l f i t S di i
.
,

ar s n ro es i se 3 7; n o n ar n a, 1
tw p 3 9 p t f th p fit dig t g
,

o t ar s , 2 arm t o e l ro ass es s en ac co r n o en er a
t di t ly t x bl 3 9 ;i j y v l ti i b d t b m
,

n o r ec a a e, 2 n ur a ua on s o un o ec o e
t o r en t d l b an by t x t i f a o ur q l 3 7 ; h w t hi i a a on o un e ua 1 o s s

330 33 ; l d t h w it d l m di d g lit y
, ,

1 an ax , i o th ea s re e e n e en er a
w i t h 33 33 ;t x p v b 3 7 3 8 ; t yt h
,

1, 2 f M t
a u o n re en u e o on au an , 1 1 e,
f i H m b g 33 l vi d p d
, ,

o n a 334 ;t illur t 2, th f
a e, ax e e on e ro u ce o
p fi t f 335 336 ;diff l d 3 8 3 9 ; i Ch i
, ,

t x a on ro s o d e an 1 1 n na an
ff t f t p fit f g l 3 9 ; l vi d i m y
, , , ,

r en t e ec s o B ax o n ro s o en a 1 e e n one
i t d d g i lt i k i d 3 0; v l ti
,

n ra e an 337 338 a r cu ur e , f or n n 2 a ua on o
wh eni t t ff t d by t
n er es a 3 0 3 ec e ;m d p id i li
,

ax o n 2 21
,

o us a n eu
,

p fi t f 339 f t yt h h ,

t
d t 3 —
ro s o 3 ; o e, 21 on o us e r en
i l l w f i 34 ; d g
,

S uc c ess t
on, n a ur a a o 3 6; l 1 an r o un r en 21 2 v a ua
d d by l w f p im ti f i g t i
.
, ,

s uc c e e e a t B i
o 3 7;r o on o n r ea r a n 2
g iten ur e ,
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,

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ear
Su g h igh p i
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.
,
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,

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.
,
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8 3—
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1
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45 2 W e a l t h of N a t i o n s T he
t t k i H mb g 33
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re en u e an e ort s n t er t o se c e ar ar es t o
l d 33 333 3
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°
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, ,

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p fit f p d d p
,

333 334 ; th on f e39 5 39 6 ;

ro s o ar o r en er e er
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, , ,

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ll i F
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n 39 7 ; i t i
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,

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p ll t
o 338 339
a x eS , 34 9 35 0 ; id t i t h w f th
,

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, ,

o n s er an s, n th o an e e r s s s e o a a on
Vi gt i m i F mig h t b ppli bl t ll t h
,
‘

n e 339 ; t
e n r an c e , ax e a ca e o a e
on t f f p p t y 34 0
r a n s er en c e o diff — t p vi ro f th
er m pi er en ro n c es o e e r e,

34 ; t m p d t i d d ti
,

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re gi t t i 34 34 3; w h m T h p ly w d d i 0
s ra on , 2, on o eac er s , o or re ar e 12
v i t x f ll 34 3 34 4 ; ; th i t ip d i ld
.
, ,

th e ar o u s a es a 1 21 e r s en s n o en
gi t t i mm v bl p t im i G
, ,

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p t y 34 5 ;t x w g T i mb t f m i
,

er 34 6 a es o n a48 49 es , 5 er , r en ro 1 1 1 1,
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.
, , , ,

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—
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,

—
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es 55 ;
a ea es r en 1 1 en c o ur a e en
giv t di v y d w ki g
.
, , ,

35 4 35 5 3 7 369 ; p i mp l
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t x i G t B it i
, ,

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i f li f 35 5 35 6 i T b
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, , ,

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, , , .

7
c o n su a e 35 ; co o es , a e a s su ar , 1 1 e o s
c o ac h d pl t t 35 7 35 8 ;S i
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ax, r a o e o ee u
,

e r c e, 1
h m ft x p h xp t t i,

M t th wD k
a e ec er s s c
’
d e e o f a a ur c as e an e or a on o
ti 35 8 35 9 ; x i 330 333 334 ; E gl d m ,

t m
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d t i 35 9 t iq i t y f t m d wb k
, , , ,

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d t i 35 9 360 t h b h ll w d ii
, ,

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.
,

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i mp t
,

or d x p —t d t i i T g d P d g 360 36
an e or u es n o nn a e an o un a e , 11 1
th t im 364 ; v i l d d f ig t d f
.
,
’
au or s 36 e, T w 1 re en u e o n, n an an ore n ra e o
dim i ih d t h t h i d i 3; i d t y id
,

n s e ra er an i
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by h igh t x t i 364 ; l w i g dv t g th th t
.

a a m
on, o er n o re a an a eo u s an a
o f m dy f
a re dimi t i e f or i d i th nut y 3 4 on o c arr e on n e c o un r 11 11
v m ggli g 365
, , , ,

d f 6 u n
°

re en u e , a n or s 11
gg t i f imp v m t i T w ll w d t f m t h i w
,

su es on or ro e en s n o ns a o e o ar er o n
e x i l w 365 366 ;S i R b t
c se a s, v i 35 3 35 4 ; p ivil g
r o er re en u es , r e es
W lp l hm i g g t d t 35 5 ;m gi t t
.
, ,
’
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367 ; x i pi it liq l fi t i t it t d i
,

e c se o n t ws r iu o us uo rs o n c o un c rs ns u e n
th e m t p d t iv os 368 369 ro F
uc 35 6 ; f
e, f G r an c e , r ee , o er
wh t l wh t m y 35 6 ; f I t ly d S wit z
,

on a d c as s a n m on a co an o a an er
ti t x h ld j t ly f ll l d 35 6 ; mil it i f i f m
,

m di o es a es s ou us a an a o n or er

369 ; x i pi i t liq t im t i ly i d
, ,

e c se o n s 35 6 ;
r u o ust u o rs es , no en re n e

368 369 ; m l t t x 370 37 5 a p d t i E gl d d F a -

en en n n an an r an c e,
p ly h i i d lth
, , , ,

e ff t
ec f t o m a ax 3 5 7 ; t
on a w ono o e r n c r ea s e ea a
p i 374 ; t h b id
r c e, ot m er sb fit t t h i es t y
es c u s o s en e o e r c o un r
d x i ff t i g t h p i f t ,

an e c se, a f ec mm n d m e f
r ce o co er c e an an u ac ur e o

g d 375 ; t i t d t i 37 6 ;
oo s, th
r an s f i mp v m
u t
es , d e c au se o ro e en an
i wh t w y t x
n a l x i
a a l t iv t ies f th
on t y 366
u ur es cu a on o e c o un r
t k p k t f th
,

t f th 37 0
p pl 37 7—
a e ou o e oc e o e
eo e, 38 th Al l f T d b tw
1 e t w dc a va a ot y ra e e een o n an c o un r
S p i 38 ; vl f t t g l ti f p i d
,

a n, 1 on a ue o c o n r ac s re u a on o r ce e
i N pl
n a 38 38 ; y t m f i
es , 1, p d t 2 s 3;
s e p ti o n en en on, 11 cor o ra o ns
G t B it i l v it i t i
r ea r a n, eat es y f it b t t g v
s n
,

er o r no n ec e s s ar or s e er o er n

co mm fer c e 38 ; f th r ee , m t 7; 2 p it l mpl y d o e en 11 ca a e o e in
f mi g f 384 386 ;t h F h wh l l t il 3 5 ;
,

ar n o ,
-
d e m r en c o esa e an re a ,
2 co
 I n d ex 453
p ar a t i
ve a dv an t a g e of ca pi t l a ll a o we d p u on w i n es , 3, 4 ; p r o
pl y d i h m f ig
m fit f t th yi g t d
yi g 3 9—
e o e n o e, o re n, d or s o o e c arr n ra e , an
c arr n 333; yi g t h
2 t th t m
c arr 5 ; ly j t i
n e o e c us o s, on us
ff t ti l d di t i
. ,

e ec t th no f e fi d
c aus e o t i na on a e un er c er a n con ons,
w l t h 334 ; t h limi t
ea f 5 6 ;b e ti t dv t g s o o un es , n o a an a eo u s
d 334 335 ; ip d f t y
, ,

h m o t e ra e, t th t r ec 7; ro o e ra e o a c o un r
b ty p t ti
-

l b fit f b t w t w x ,

c a
c o un r
en e
t y 336 339 ; f
o
ig ,

m
d e

7 — 0
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o
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1, x t v g t h pi
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,

t li
a ty b f th e o rext i f by b t i
e e 9 0;
en s o n f th o o un es , 1 ur er

363 364 ; h g f m id t i th b ty
,

mm
—
c o er c e, c an e ro cons er a ons o n e o un on
th f d l y t m w gh t by m 6; g l bj t i
,

e eu a s s e rou
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m 366 367 ; ff t f f
er c e, ig t e b ti ec o xp t t i ore n o o un es on e or a on,
x p dit 7 ;b ti p p d ti
,

mm
co th
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l g p p i t gi g t i d t y
,

ar e ro 366 369 ; m
r e o rs , m u ore en c o u r a n o n us r
-

l b fi t f f ig t d 39 8 ;b ti g t dt h ,

t 7
8— ;
ua en e s o ore n ra e, 2 1 1 o un es r an e o er
i t imp t t i h w ig d wh l fi h i
,

t
r es r a n s on or a on, o r n an a e s er es , 1 22
f ar b fi i l t th g en e c a l i o d t th e m m d it i
en er a n an o o er co o es , 22,
d t y f th
us r o i t y 39 7 if ;t h
e so c e 3; l i l 7 3 ff ; ff t f e 2 co on a e ec o
p ly f h m m k t giv p ly f 9 3 9 7 ; x mp t i
, ,

m ono o o o m e ar e s en ono o o -
e e on
t th
o p d e f d m ti
ro uc e i f m d ti
o o t i esi mp t d c n ro u es on
,

c er a n or e
t y i it h h tf l mm di t i g t f
—
d us r s e er a ur 38 ; u o r us e co o es , 1 r an o
l es s r eg l t i u a
4 0 4 3 mon, p ly 1 -
iv bo t i ono
4 0 4 ; o s u c c ess e o un es , 1 1 2
o f h m m k t m o e b fi il
ar p h ibit i
e s o re xp t t i f
en e c a ro ons on e or a on o
t o m h t—t h g zi d
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an ra xp t t i
er s an oo 1 2 -
1 on e or a on
i whi h f th mm di t i
,

f m ar 4 03 4 06 ;
er s , c as es n 49 5 3; c o o er co o es , 1 1
i t mp t t i b l 5 3; b d
-

t
r es r a n i on or a on hm en e on c o a s, 1 ur en on o e
fi i l 4 06 ;A t f N vig t i
c a c 4 07 o m a t il d a by t h
on, c o n su er en a e es e

4 08 ; i f l id d m ti i t 5 6 ; C lb t
, ,
’
t a ax a t on 55 a o es c r es r a n s, 1 1 o er s
id t y q l t h ld b y t m 5 7 5 8 ; dv t g
,

n us r an e ua ax s ou e s s e 1 1 a an a es
l id t h lik f g p d t f f d 64—66 ; v
, , ,

a on i
e e ore t n ro uc o r ee ra e, 1 1 re er s e

4 08 4 09 ; t x th a es o n f th pp i t y t m 66
e n e c ess ar
,

o e o os e s s e 1
f li f th y d i Ch i E gyp t I
, , ,
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o 67 ; t
ar e r a se e 1 ra e n n a, n

p i f l b th d t d G
,
r ce o da o ur , m an o er 73 79 ; co o s an , an r eec e , 1 1
id im p i t i
-

m di ti
o 4 09 es , 4 0; 1 f t consit di er a os on o r es r a n s o n, s
f C lb t p li y 4 ; g i lt
,
’
ti on o o er s gi g t o c 79 1 1 c o ur a n o a r cu ur e, 1
m t l pp h th d wb k t t h
, ,
’
u ua io f r ess o n o 80 ; d ea c o er s 1 an a ra ac o e
i d t y by F
n us r d E gl d w
r an c e a n l t h f i t y 80; ff t n an ea o so c e 1 e ec on
t ip p t f t x ti f p fit k
, ,

4 11h w f o i ar t s ro er f t
o r es o r e o a a on o ro s o s oc
af t d— r ee th t h
ra b i t
e 337
a 338 ; x i
as een d t mn er e c se an c us o s
,

4 4 ; pp i t i d t i 35 9 fi x p t t i
,

ru pt d 4 e 12 t 1 o os on d o u es , e or a on an
f t d 4 4 4 5 ; t x im
r ee ra
,

e, 1 imp t t i 1 g l ti a es or a on, re u a ons con

d t p v t dim i i h im i g i th th t im
,
’
p o se o re en or n s c ern n n e au or s e,
v
,

p t ti
or a j i t th
o n 1n ur o n s 36 364 o e re en u e 1
°

o f th et m 4 6;
c us o th T ti s, f 1mm dv t g
on e r ea es o co er c e, a an a es
q ti
u es f f
on t o d b tw r ee d di dv ra t g e f i i 43 44 ;
e een an sa an a es o
F d E gl d 4 6 4 8; b t w E gl d d P t g l
.
, ,

r an c e an n an 1 1 e een n an an or u a
it i g lly p
-

, ,
t h tw e o cr er o n s 44 en er a a

p l d t i d t d t mi
ea e o, n or T mb l er d Pi ll y S t t t
o e er f i ne u re an or a u e o
w hih t i xp t , ,
.

cf tw o o 67
c o un r es e or s 1
t th g t t v l 4 8 ; t h T k y C mp y Th
g 4 8—
o e r e a es a u e, 1 3 4 e ur e o an e, 11 22 22
f x h
.
, ,

c o ur s e o
«
e 4 c ; an e, 1 22 on
th ble f t
a an c e d 4 3 fi ; U iv i t i
o ra Ed
e, ti 1 n ers es , s ee uc a on
w lt h f
ea igh b i g t i
o a ne U y i B g l d R m 1 84
o ur n na on s ur n en a an o e,
dv t g , .

a an a t 4 37 ;
eo u s d w o, ra
b kac s gm t t x Vl
en c o ur a f
e mm di t y l b
en s o th e a u e, o a co o a o ur e
ii t ll w d l m f i
,

p t ti
or a on , ; 1, 2 no a o e on r ea eas ur e o 2
9;
t i g d y p i f g d 3 33 4 ;
.
,

c er a n 3; m
oo t f
s, m 2, a o un o one r ce o oo s, 2, ,
1
4 54 W e a l t h of N a t i o n s The
d t l d p d ly
o es n o f h i v i i
as a r u e i di ff e en on on c a u s es o t e r ar a t o n n er
l b i ivil i d
a o ur i 48 ; n c d 89 ; f kill d l b ze c o u n t r es , en t t ra es , o s e a o ur
f mi
o dp d hi
n es , d mm t er lb e 9 9 v en en t on an co on a o ur 0, 1 ; ar y
l iv f iliy 5 8 f wi h y i y
,

r e at e er t t , 1
t ; o es t a es t c o n s t an c or n c o n s t an c of
b v g d
a o e hi b l
r o un m pl y m
o n t e r a so u t e 9 93 d i g e o en t , 2, ;a c c o r n to
f ili y 5 8 5 9
er t t , 1 p iv 1 h
; r es ec t p d h w km
e t e t r us t re o se in t e or en ,
vl p d di g d i g t t h p b bilit y
,

a u es o f r o u c e a ff o r n r en t 9 3; ac c o r n o e ro a
g l ly
r e u ar an d i g l ly
rr e u ar 1 60, imp b b ili t y f 94 ; or ro a o s u c c es s ,
p p i h
1 61 ; r o o r t o n o f t at o f c a
,

pi l
ta w d ld t d 03;w g in n e an o ra es , 1 a es
h i
t o t a t o f n t er es t , 31 7 l w f l b th t t th l o or a o ur a is n o e so e
Vl a ue i n d Vl i
us e,
”
mpl y m t
an f l b
“
a ue 05 ; n ex e o en o a o u rer , 1
ch g i 5an e, 2 06 ; d d by mp t i t i ; 1 re uc e co e on , 1 1 2
V ti th i i pi i d i th t y by
.

en e an s , mm e r co er c e n s c es , n c r ea s e n e c o un r
n 56 57 l w i g f p fit t h t w 6 o er n o ro in e o n,1 1
V i b k f 99 ; l dt x i t m th d tig
.
, ,
en c e , an o 11 2 f 8;
an a an c en e o o ra n 12
i V ti it y 3 A t p d f g l ti f 9
.
, ,
n en e t an err or 12 c asse o r re u a on o 12
V i p i f i 05 f th th p t i t whi h
, ,

en so n , r ce o 2 one o e r ee ar s n o c
d t i m ii 34 0 th p i lp d
.
,

Vi im H
’

c es a er e z a r u f th e r ce o e an n u a ro uce
Vill g t f i 34 6 34 7 divid i t l f 30 ; i d by t h
.
,

an a e, e n ur e o es se 2 r a se e
Vi y d p fi t f i 4 0 4 ; mp t i t i pi t l 3 6 ;h w
.
, , ,

ne ar ro o f 1 1 1 as co e on o ca a s, 1 o
mp d w it h t d p fi t f ff t d by m p ly ii 09 ;
.
, , ,

co ar e r en an ro o a ec e on o o 1
d p t t x ff t
.
,

c o rn a n 4 4 a s ur e 1 f 1, 1 t 2 d a es on, e ec o on r en an
Vigi i d M yl d l t iv t i pi f t d g d
.

r n a an ar f m an cu a on r ce o an u ac u r e oo s,
ft b i i 43 44 i F
,

o o ac c o n, 34 7 ; t 1 1 34 7 ax o n, n r an c e,

34 8 ; i B h m i 34 8 ; g l t d
.
, ,

n o e a, re u a e
W ga g l t d by di ff
es , r e u a e t p i i by t h p i f er en it i 35 ; r nc e r ce o n ec es s es , 2
pl t p fit i 4 3; f t
es o ro s, ff t d by t x l x i o en con un a ec e a on u ur es ,
f d d w it h p fi t 4 7 ; d w it h
.

o un e 35 3
ro s, an
r en t 4 7 ; ff t d by fl a t ti
ec e W lp l S i R b t h i x i uc u a ons a o e, r o er s e c se
i th
n m k t 5 ;
,

e v i k
ar e h m ii 367 2 ne er s n sc e e,
,

b l w th i t l t f t i d f y d
.
,

W
e o
g t l gt h f t im 5 5 ; d i y
rea en
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o
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1 .

t
ra e o f wh t i t d p
on d 5 0; W l t h a i t i p w f pu e en s, ea cons s s n o er o r
h ig h t i t h t i whi h h i 7 ; it ti l i
, ,

es n o s e c o un r es c c a se, 2 s con n ua n
g wi g i h th f t t 6 ; i i iw g
.

ar e ro n r c e as es 2 cr e as e o c c as o n s a r s e n a es ,
h igh i N t h Am i t h i 6 ; i d li ,

er n or er c a f i t an n 2 n cr ea s e or ec ne o s
E gl d 6 ; t h igh i ff t p fi t d w g 7 8 ; ,

n an 2 no n a c o un e ec on ro s an a es ,
t yw h
r w lt h i t t i
er e
,

ea y 63 dv f i s s a H y VI I I
o n ar a an c e o s n ce en r
’
s
f i G t B it i t im 7 9 8 0 ;p i mt l d , ,

t
ra e o n 65 66r ea r a n, e, r ec o u s e a s an
l d yw g i S t l d i t h d d li t t l t 58;g
, , , ,

usua a a e nt co an l n e s o n es a e o, 1 en er a
17t h t y 68 ;it i i p t
c en ur id i g ti l 9 ;
s r se n
,

ar s ea s c o n c er n n na ona 21
i 68 ; i fi v l f g ld d ilv p f
, ,

s n c e, f th r ea s o n o e r se o n a ue o o an s er n o ro o
h p y 74 ; i f w lt h p v ty f ,

c ea ear s , i i n c r eas e ti n, n o ea or o er o a na on,

c r eas es p i f mm di t i 77 ;r ce o 9 0; p i
co f g od p es , 21 22 r ce o oo s in ro
i kt d t i p ti t i di t i f
,

n c r ea s e f t o s oc en s o r a s e, or on o c o r n , an n ca on o

7 8 ;h v b lly i i g ; l d t it t hi f ,

a e ti een co n n ua th r s n 221 an cons u es e c e

i y VI I I t im 8 0; w lt h f v y
’
s nce H en r s t
y 3 i e, ea o e er c o un r 22 n

g lly h igh i t w t h i i w lt h f i ty t d
, ,

en er a er n o n an n c r ea s e n ea o so c e en s

th e t y 8 0; l w
c o un r i S t t i l t fl d 9
o er n co o r a se r ea r en o an 22
l d t h E gl d 8 0; d i i f i E gl d 307 309 ;
, ,

an an n an an n n c r eas e o n n an -

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, , ,

r an c e an m n f an m 1 n so e o es o e en s e o re
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,

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,

i 8 ;d
n an 3 0 3 ;
o o n es , pi t l d 2 o c r e ase , 1 -
12 ca a u se
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s o s oc n a r cu ure os a an a eo us
l w d w i t h dimi t i f t k 3 4 3 5 ; t h t wh i h i ,

o er e t nu on o s oc o, 2 2 a c ar s es
84 ; ff t d by t h w l t h
as a ec e d f m g i l t m d bl e ea an
,

ro a
,

r cu ur e o re ur a e

p p l ti f
o u a on t y 84 8 5
o th a th t i i g f m mm
c o un r an a ar s n ro co er c e

1 0
3 ; l ff t
ess ad by h ig h p fi
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,

h t ro
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s o u ar no on a

th th p i f w k 87 88 ; w lt h y 375 ,

an e r ce o i t i m or , ,
ea co ns s s n one ,
 I ndex 455
”

39 5 ;r es t r a i nts on t ra d e a d w ra b k ac s, l
al o w e d p u o n , 11 m
3, 4 ;i
b k t ii 8 0 i l i
.

ac o, 1 p o r t at i
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.

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p fi t f t k i i 8 3;p i f
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. .
,

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sug i n, 1 2, 1 rs sc o er n n En ts
°

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f b y C l mb ii 5 7 5 8 im l
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d yv g t bl f d i 58 59 ; x p t t i f 5 ; f ll f p i
.
,

an e e a e oo n, e or a on o 21 a o r ce
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6 ; ffi y f h m i d ty , ,

t i 338 339
ax n, 21 e c ac o u an n us r
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,

a e s er o un i
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,

6;
g i t x p t t i f ii 4 3—4 6
. 1 -
22 n e n an , ,
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76 a a ns e or a on o 1 1
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.
,

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.
, ,

ro e nn n o 1 c en ur u an an ua 1 1
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,

t o 64 ; i 1 t m n 360 ; an c en c us o s u es o n ,
xp t t i f p h ibit d 36
-

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1 64 65 ;m it k 1
,

i t im t i g W ll m f t
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,

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,

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,

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66—
e f i
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,

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.
,

u St M
r e 68 a ur o n , 1 1 or en , co ar so n o e r
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.
,

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,

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°
o an s er e en en
q t i t y f w hi h t h y l iv p ivil g f i y t d
,

on u an o c e c an e us e r e es o n an ra e
d t if i i t y f w k
,

b y 7 u 7 ;d 1 i t w
1, 1 d t
2 e ar n o n s , an en s o n er o r o or
t v l
, ,

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n c er t i 74 i
a n c o u n r es , 1 8 s a ue 11
°

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(
n
d
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ro

)
t
57 0—or
64 0
er o 75
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a
1
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, , ,

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17 6 ff ; fi t f iv il w
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, ,

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p i 76 77 ; b t y p f j tm
.
, ,

on
th e xp t t i
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77 8 ;
34 8 ;
,
ti1
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, ,
.

r ce o n o t o e, 1 con e as es o, s o r er ea s es
t t p i
r ac i E gl r ce d bf g t dt i F
n n
34 9 ; anvi e o re r an e o n r an c e , s er c es
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.

th e f ears o s c ar c 2 r ce e er e o un o er o r
y VI I d E dw d I V bj t d t p bli t x
, , .

i H
' ’
n enr 34 9 ; s an ar s su ec e o u c a es ,
t im 5
e, 6 ; t bl
22 h w i g 34 9 35 0; g l di
22 a esg s o n en er a s c o ur a e
p i f f m 0 t 75 0 35 0 35 ; b fit l
, ,

r c es o m t t
ro 12 2 o 1 en s o, 1 en e es s
2 3 40
2 -
2
,

f m t h m p ly f h m ,

ro e ono
,

o o o e
Wh l l d t il t d p
o es a e an m k t
re a th m h t 4 03
ra e, r es ec ar e s an er c an s ,
t iv p fit f i 0 0 Y k hi p p y i
.

e ro s o 1 1, 1 2 or s r e, a er c urr en c n,
W i imp t
n es , d d w
os s
,

on , an ra

TH E TE MPL E m a ss , P T
RI N E RS , L ar c n w o nr n