Our surprize vanishes upon discovering facts, at a glance so irreconcilable, to be true; but it returns with tenfold force, and rises up to amazement, upon being told, that the omnium of these facts, proves the wisdom and justice of increasing both this scarcity and this plenty of money, by a new bonus to capitalists. As extravagance, exclusive privileges, and monopolies have already involved the great bulk of the nation in distress, scattered poverty, disabled the people from paying taxes, and sorely afflicted debtors; and as they have already created a superabundance of capitalists who know not what to do with their wealth; a remedy for the mischief, and not its aggravation, seems unavoidably to present itself. When the fat-sow monopoly, confesses that she has swilled wealth, until her corpulence had become distressing, it would be like murder to pour more down her throat, and run the risk of bursting her. What should we think of a physician who should propose to make the nose larger than the whole body, by converting the aliment of the other members to its growth? Would he be a bad model of the politicians who have bloated up a capitalist interest to a pecuniary plethora, by starving down the other members of the body politick, to a pecuniary famine? Can a republican party have been this quack? Will a republican party increase the political nose, until its necessary amputation may endanger the life of the patient?
The Committee use many expedients to draw off our attention from this political caricature; this sport for capitalists and death for the rest of the nation; and by huddling assertion upon assertion, leave us to imagine that there must be some nostrum in the multitude of medicaments, able to reduce the monstrous nose to a natural size, or at least sufficient for the present to hide it. They sometimes endeavour to make us fall in love with the huge nose, by telling us that when it is made still larger, all the other members may feed upon it; and that though it starves them now, yet it will afford them a delicious repast, like the tail of a cape sheep, so soon as it has grown to a sufficient size to fatten all the rest. At other times, they ascribe the leanness of the other members, not to the excessive fattening of the nose, but to certain conjurations of necromancers three thousand miles off, able to impoverish all the members, except this fortunate nose. But the Committee have neither told us, how it has happened that British machinations have been able to starve all our social interests, except the capitalist; nor how this one interest has fattened up to excessive corpulency, in spite of these machinations. Have the British been giving bounties to this interest, whilst they were endeavoring to impoverish all others? Let it then apply to its benefactors, and say, "you have wisely made us enormously rich at your own expense, and therefore you will act still wiser, by making us still richer." How would the British regard such an argument, though attended with an assurance, that a compliance with it would at some future day increase their wealth and prosperity? If the great wealth of the capitalists were not extracted from the British, let them say from whom it was extracted, and address the same argument to the prodigal donors. Should it be of domestick origin, it must of course result, that not British, but domestick machinations have created an enormously rich unproductive class, and thereby inflicted upon productive classes a very considerable degree of distress.
In pursuance of the policy of diverting our attention from the phenomena of exuberant capitals and a general distress, the Committee have thrown out other lures. "The importation of foreign goods was never so great as when our embarrassments were produced." In the whole report of the Committee there is no hint that a legal accumulation of capitals in a few hands, has had the least influence in producing the national distress. A pecuniary inquiry, if its object was truth, could not have overlooked the largest pecuniary item, having a more extensive influence upon our pecuniary situation, than all others united. Whilst the advocates of exclusive privileges pretend to so much skill in calculation, and have been prodigal of figures, it is marvelous that they, and more marvelous that a Committee of the legislature, raised to find out the causes of our distress, should have been so covetous of both, as to have passed over with the most cautious silence, our enormous legal or artificial accumulations of capital. But a fair accountant will confront this item, in searching for the causes of our distress, with that of an importation of foreign goods. Suppose we change the assertion and say "the importation of foreign exclusive privileges, monopolies, and modes for accumulating capitals in a few hands, was never so great as when our distresses were produced." We are then left at liberty to consider which of these contemporaries contributed most towards producing our distresses. There was certainly a new procreative power disclosed by an importation of foreign goods, if that produced them; and it is even miraculous, that an importation of property, at least equivalent in value to its emblem, money, should suddenly have reduced us to distress, after we had flourished many years under such importations, less restricted, and often larger in proportion to population. But there is nothing either new or miraculous in the capacity of a system of extravagance, exclusive privileges, and monopolies, to produce national distress. How could it happen that exchanges of property with foreigners should ruin us, but that transfers of property to capitalists should do us no harm? In one case we receive an equivalent estimated by ourselves; in the other, we receive no equivalent at all. Is sudden ruin from a great importation of property more likely to ensue, than ultimate ruin from our progressive policy of transferring property from industry to capitalists? The original funding system, subsequent loans, a flood of bank currency, the bankruptcy of some banks, and the refusal or inability of all to pay their debts, the extravagance of our governments, loans, pensions, and the great increase of protecting duties, in many cases amounting to a prohibition, are so many instruments for cutting off every species of property from industry, to enrich capitalists, as the Abyssinian fattens himself with steaks cut from living cows; and this transferring property now assures us, that the pain and anguish at length produced by its operations, were occasioned by an importation of foreign goods. As such an importation was unavoidably contemporary with the catastrophe of the property-transferring policy, it gave the Committee an opportunity of exclaiming, Aha! we have detected the thief who has stolen our domestick property. Foreign property has done the deed, and reduced us to distress. We have, against this mode of stealing, the resources of eating, drinking, wearing, exporting and selling the thief himself; but we cannot eat, drink, wear, export or sell our capitalist, our pension, our banking, or any of our exclusive interests.
But "the importer's ledger ought to settle the question, and in the cases of bankruptcy foreign creditors appear." The doctrine of the balance of trade not being sufficiently intricate and dark for the purposes of exclusive privileges and monopolies, they are driven by fear, and by the want of arguments more suitable for examination, to appeal to a perfect camera obscura, hoping that it may afford some gleam sufficient to turn objects upside down. What a tenure is this for our liberty and property? Both ought to be determined by importers' ledgers in the opinion of the Committee, which ledgers are to decide whether exclusive privileges and monopolies are their friends or foes. Did the Committee really intend that the nation should examine and settle up these ledgers, to be able to estimate the evidence they might afford; or that our liberty and property should depend upon their own intuitive or inspired conviction, that there is decisive evidence hidden in these ledgers in favour of monopolies and exclusive privileges? Instead of endeavouring to extricate this evidence from its numerous dungeons, it may be wiser for the nation to open a ledger between itself and the several modes for transferring its property to capitalists. The items are few and notorious; and the balance between the nation and monopolies and exclusive privileges may be discovered with infinitely more facility, than a security for our liberty and property in importer's ledgers. The following might be the form of an account:
Here is a plain loss to the nation of six hundred millions of dollars in twenty years. Can the importers' ledgers possibly contain any thing to prove both that it ought to be continued and even increased? But the estimate is too low, because the property-transferring policy ought to be charged with so much of the extravagance of our governments as it has caused. This item is somewhat harder to estimate than the others, because it is blended with the blessings of government; but the others return no compensation to the people either physical or moral. They both take away property and aggravate moral evils.
I have laboured in vain to discover, what bearing the appearance of foreign creditors to claim some dividend, in our cases of bankruptcy, can have upon the subject. Credit, like currency, is governed by the common law of commerce, and both are liable to be counterfeited. If we could give to foreigners our bad bank money for goods or specie, it would not be a bad trade. In giving them bankrupts for goods or specie, the trade is the same. But in the trade of bankruptcies loss and gain is reciprocal, and it would be as difficult to find how the balance stands, as to discover and hold the long-sought and yet unfound balance of trade, or the conclusive evidence said to reside in the importers' ledgers. A free nation would never submit to a plain system for transferring property; and, as it was therefore necessary to make the protecting-duty item of this system, as obscure as possible, I do not know that the Committee could have found better arguments in its favour, than a balance of trade, importers' ledgers, and casual bankruptcies.
"We have only the miserable and ruinous circulation of a currency for remittance to foreign nations. They hold the coin and we hear it jingle." The contradiction in these very short assertions is palpable. How can we make remittances in coin which foreign nations hold? It is palpable also compared with the assertion "that there is more specie in the United States than at any former period, but it is unemployed." How is all this? Foreign nations hold the coin, yet we hear it jingle. We hold more coin than at any former period, more than we can employ, yet we remit it to foreign nations. Was a pretty antithesis a temptation not to be resisted? Did a jingle of words cause the Committee to be content with a jingle of facts? Instead of our having a currency for remittance to foreign nations, we abound in a currency which will not answer that purpose; which cannot leave us; which is not subject to the honest common law of universal commerce; and which sticks to us for better or worse, as a bad wife sometimes does to her husband, long after he wishes she was dead. We have, in fact, but little of that kind of currency in circulation, which serves for remittance. It is true that we have heard the jingling of this kind of currency in the newspapers, and the Committee have rung the same bell, but our ears are thus regaled, merely for the purpose of keeping up the credit of that kind of currency, not liable to be remitted to foreign nations, and so happily employed at home in transferring property and creating capitalists and paupers. A free commerce would bring the musical kind of currency into our pockets, and diminish the bad effects of the transferring currency, by exposing it to the wholesome discipline by which commerce regulates the value of specie. To evade this discipline, the Committee propose to impose further restrictions upon commerce, lest it should lay hold of the specie deposits of banks, and destroy the credit by which they are enabled to transfer so much property. This is necessary to keep up the exhilarating jingling, which dispenses dividends of transferred property, and will also acquire an additional monopoly under the pretext of supplying us with manufactures, as its predecessor succeeded under that of supplying us with money. If remitting specie, to acquire what specie represents was an evil, free commerce would certainly remove it, but the property-transferring policy is fraught with the essence of modern tyranny, and admits of no remedy except that which puts an end to the power of doing mischief.
"The excess of exports over imports is the rate of profit." However impossible it may be to ascertain this excess (since every calculation is deranged as soon as it is made by the perpetual fluctuations of commerce) it is not hard to discover the sophistry of the position itself. Both exports and imports are property, of which money is the emblem. Suppose trade was carried on by importing and exporting the emblem only of the things it represents. Where would be the misfortune of importing regularly more money than we exported? It would lie only in its exuberance, depreciation, and inutility, arising from the inhibition to exchange it for foreign commodities. If there is any difference between trading in the emblem, or in the substance itself, it is in favour of the latter, because a surplus of the emblem would be less useful than a surplus of the substance. The latter affords more comforts, excites more industry, and employs more shipping. The substance is also as reexportable as the shadow. A trade in the substance may be permanent; in the shadow it cannot long exist, on account of the equalizing power of commerce, and the depreciating nature of money. Being only an instrument of exchanges, its office cannot be impaired or destroyed, without impairing or destroying commerce itself. A permanent surplus of money, beyond its instrumentality for facilitating exchanges, cannot be gotten and held if commerce exists, because when its plenty makes it less valuable than in other countries, the exuberance will be drawn off to the countries where its scarcity has made it more valuable. In like manner a permanent surplus of the commodities represented by money, cannot long exist, because the same power which acts upon the emblem, will act upon the things represented by it. In this view the importation of more money or more commodities than we export, is equivalent. Commerce acts in the same way on either surplus by reexportations, and profit results from the greater degree of mercantile skill and industry inspired by liberty. The question therefore is whether it is better to leave the regulation both of imports and exports, either of money or the commodities which it represents to the common law of commerce, which other nations may occasionally disorder but cannot repeal, and which must continue to act powerfully in concert with individual interest, in spite of fraudulent interpolations; or to resign their regulation to two monopolies—to banks, as to the regulation of currency; and to protecting-duty capitalists, as to the regulation of the price of commodities. The coalition between commerce and individual interests by perpetually labouring to diffuse comforts, wealth, and happiness, invigorates industry. The labours of the combination between their privileged rivals are devoted to a monopoly of comforts, wealth, and happiness, discourage industry, and generate pauperism.
But, say the Committee, "no other remedy for our troubles has been offered, but an extension of the restrictive system, which they propose as a forlorn hope." Among the assertions hazarded in the report this is the boldest. Does not this controversy propose a remedy? Do the advocates of this remedy acknowledge it to be a forlorn hope? Has public opinion remained torpid longer than the dormouse, or is it entranced by the musick of exclusive privileges? On the contrary, is it not distinctly groaning under the whips and scorn of the various modes of transferring private property by legislative acts? It is one of the greatest misfortunes to mankind, that the justice which can only be rendered to nations by frugality in governments, has never been able to find a shield which could not be pierced by the arrows of wit, cunning, and ridicule. The tribes of patrons and clients, unite their talents to caricature every proposition suggested by benevolence to nations, and the Committee with contempt assert, that no remedy for our troubles, except their own forlorn hope, has been offered. Such arts constitute the science of modern civilized tyranny, and are therefore universally opposed to advocates for frugality, and its offspring, civil liberty. Even at the head spring of hope, in legislative bodies themselves, the refreshing water of frugality, is already muddied by those impurities which a blind confidence will for ever generate. Are legislative wages to be increased? Arguments abound: are they to be reduced? None can be found in favour of the frugality by which the public confidence was won. Speeches and professions are made; delays are practised to feed the public hopes with unfruition; and when these hopes are tired out and blunted, some member whose local influence is secure, strengthens his legislative influence by defeating the proposition. He addresses an internal sympathy; he easily appeases an external opposition; and he welds to himself all who can be persuaded that they deserve the salaries they exact. Among the artifices practised to smother frugality even in the womb, is that of mingling legislative wages with moderate salaries, in order to make good objections against diminution in one case, obstacles to reform in the other. The most plausible argument in defence of high legislative wages, is, that money buys talents; but it also buys corruption, fraud, ambition, avarice, and legislative patronage. Sound policy ought to take her stand between two extremes; one, a rate of wages so low as to expel talents; the other, a rate so high as to awaken vices. We may discover the golden mean by comparing facts. When the rate of wages was lower than at present, the abuses of extending unconscionably legislative sessions; of trying private suits without any judicial powers to ascertain truth, under the pretext of their being instituted in the guise of petitions; of patronizing individuals at the public expense; of creating a horde of pensioners; and of corrupting election by flattery, deceit, and a waste of public money; were infinitely less abundant. To determine whether the nation has obtained an accession of talents, integrity, and patriotism, by an increase of legislative wages, former legislatures must be compared with the present. Will the former Federal and State legislatures be thrown into the back ground by this comparison? Under which policy, that of moderate or high legislative wages, did the nation enjoy most prosperity? Which has nourished most extensively the oppressive policy of transferring property? What power can be more tyrannical than this, or more extensively excite those arts by which election itself, our last hope (may it not be forlorn) is corrupted, and converted into an instrument for avarice and ambition? What do high wages beget but parties and pay, zeal and adulation, fraud and usurpation? An elective government thus poisoned, communicates the infection to the people, and is itself the cause of the spreading malady. Will its health be restored by the poison? Will its integrity be increased by bribes to become vicious? Was the situation of New-York, arising from an enormous legislative patronage, through the medium of a dependent and party council, no evidence of the consequences to be expected from such a policy. If it pollutes a State government, will Congress be purified by an absolute power over property, and by patronizing itself with high wages and protracted sessions? Our distresses answer the question with melancholy veracity. Must not legislatures pull the mote out of their own eyes, before they can introduce a general system of frugality? No policy can be worse than that of bribing representatives by high wages, to entail lasting evils upon their country and therefore an inquiry how far we are falling into it, cannot be superfluous.
As the remedy for over-grown power, constantly proposed, is more power to suppress the disorders it produces; so the remedy for exclusive privileges, as constantly proposed, is more exclusive privileges, under pretence of removing the oppressions they have caused. With some inaccuracy the Committee have called an extension of the restrictive system, "a forlorn hope," as it is by no means so to capitalists, whatever it may be to the rest of the nation. It will certainly produce both sweet and bitter fruits in great abundance, and we are only to discern how they will be distributed.
The rival remedy for our troubles, so insignificant in the eyes of the Committee as to be wholly suppressed, although it has been often enforced by a multitude of able writers, and some patriotic statesmen; and although it was the basis of two federal administrations, which diffused more happiness and prosperity than can be otherwise obtained; is reducible to a few principles, which may be comprised in a few words. Return to frugality; restore a free trade; abolish exclusive privileges; retract unjust pensions; surrender legislative patronage; surrender, also, legislative judicial power; and vindicate the inviolability of property, even against legislatures, except for genuine national welfare. Not that spurious and thievish species of welfare, which usurps forbidden powers and steals private property, but the true kind, honest enough to discern a distinction between devoting rights and property to the infernal deities, ambition and avarice, or leaving both to the real owners.
The Committee have closed their proem by a protestation "that they have no predilection for foreign opinions, and are less desirous to force facts to conform to reasoning, than to apply reasoning to facts; and therefore trace the principles of political economy to the conduct and to the interest of the individuals who compose the nation." Such protestations are the children of either innocence or guilt. If the Committee were conscious that their opinions bore no resemblance to a foreign policy, where was the necessity for a protestation, that they had no predilection for foreign opinions? If they were conscious that foreign opinions and practices had really suggested the policy they have so ardently recommended, how could they protest that they had no predilection for them? They should have boldly asserted that the British policy was the best in the world. In this controversy protestations have abounded. The Committee have protested that no remedy for our troubles has been offered, except their forlorn hope of extending the restrictions upon commerce. Farmers' friends and merchants' friends, having slept very quietly without showing the least sympathy either for farmers or merchants, are now bred in abundance by the plastic power of love, either for the long-forgotten farmers and merchants, or for bounties and exclusive privileges. So very affectionate are these new friends, that some of them who know nothing of farming or commerce, zealous to correct the errors of those instructed by experience, give them long calculations and laboured directions, even at the risk of being very ridiculous. What gratitude is due to such heroic adventurers, merely from motives of disinterested friendship! But lest such conspicuous merit should be overlooked, protestations of patriotism accompany those of affection for farmers and merchants. Our protesters are for ever declaring, that they hate foreign opinions, that they abhor the British policy, that they love our own free principles above all others, and that public good is their sole object, without the least mental reservation of a local nature, or in favour of capitalists. If the farmers should undertake to instruct these protesters how to manage exclusive privileges, and augment artificial capitals, it would excite their gratitude or derision. I know not a better emblem of protestations, than hiding freckles by paint; and as it is extremely important to discover the foreign freckles with which we are disfiguring our fair republican countenance, I shall endeavour to wash off a little of the paint of protestation that they may be seen.
Suppose the Committee had recommended monarchy, but protested at the same time, that they had no predilection for this foreign opinion. Would the protestation have rendered monarchy not only harmless but nutritious to our republican principles? A policy for transferring property by exclusive privileges, pensions, bounties, monopolies and extravagance, constitutes the essence of the British monopoly, and is sustained by a conspiracy between the government and those who are enriched by it, for fleecing the people. This policy is the most efficacious system of tyranny, practicable over civilized nations. It is able to subject the rights of man, if men have any rights, to ambition and avarice. It can as easily deprive nations of the right of self-government as it can rob individuals of their property. It can make revolutions reorganizers of the very abuses they overturn, and merely a wheel for turning up or down combinations equally oppressive. What is the difference between recommending the form or the substance of the European monarchies? Would it not be better, like the Lacedemonians, to adopt the form of monarchy without its substance, than to adopt its substance without its form? It is said by the holy alliance, that both the form and substance of all monarchies, however corrupt or oppressive, ought to be maintained, because they are established. By an alliance, not less holy, between our abuses, it is contended that these also ought to be maintained, because they are established. In both cases reformation is forbidden upon the same ground. England conceals the crimes of her policy by an impartial execution of her laws, but when the judicial ermine is stripped from her legislation, though it proceeds from a government called representative, the strict execution of her partial laws, are visibly an extension of the oppressions and frauds they are calculated to perpetuate. The execution of laws contrived for transferring property, only brings men to suffer the torture of a legal rack.
The British parliament, some years past, resolved, "that the influence of the crown had increased, was increasing, and ought to be diminished." Is it not at least as true here, that the influence of exclusive privileges and extravagance in our governments, has increased, is increasing, and ought also to be diminished? Which is most oppressive, the influence of one man, or the influence of a combination between several thousand men, to rule and plunder a nation? Which can be most easily overturned, a single-headed or a many-headed tyrant? In England, the instrumentality of royal influence in extending the policy of transferring property, was the evil which the parliament believed required diminution: but such was the force of this influence, that the parliamentary conviction has never been able to check it. Here the instrumentality of capitalist influence, has been able hitherto to suppress the national conviction that it ought to be diminished. Does its strength and success prove the wisdom of making it stronger, that it may become, like royal influence, irresistible even by the legislature? In England, the nature of the government requires some regal influence, and therefore the parliament only resolved, that it ought to be diminished: here, the principles of the government forbid any fictitious capitalist influence, and therefore it ought to be abolished. In England the abolition of regal influence would be a revolution; here the establishment of a privileged influence, would also be a revolution. I blush to behold a love for the principles of limited monarchy, inducing a British parliament to speak truth; and look with sorrowful disappointment for a similar proof of affection for our constitutional principles from republican legislatures. Instead of resolving that the several modes for creating a moneyed aristocracy, have increased, are increasing, and ought to be abolished, or even diminished; and not content with a tacit approbation of this revolutionizing policy, they have laboured actively for its introduction. The Committee protest that they have no predilection for it. They only propose to drive it, not away, but towards its oppressive English completion.
The machine for this end is worked by "fictitious capital," which turns out the same effects, by whatever wheels it is kept in motion. But the machine itself is not a fiction. It is a political loom driven by the steam of avarice, manufacturing tapestry for some and dowlas for others. Governments shoot the shuttle to weave golden garlands for themselves; and if the distribution of the two manufactures is complained of, they assert their patriotism by protestations, and their confederates exclaim, "a government of our own choice, like kings, can do no wrong." Though the capitals of exclusive privileges are no fictions, but woeful realities to those from whom they are drawn, let us use the terms, real and fictitious, to illustrate a necessary distinction. Fraudulent and honest, or forged and genuine, would have been better phrases, but I conform to common parlance. The thrift and comforts conferred by real capital, are general; by fictitious, partial and local; one is free, the other forced; but the generick difference lies in the chief quality of each; real capital being an accommodation in exchanging property, and fictitious an instrument for transferring it. The artifice of blending the characters of these two kinds of capital, like an attempt to conceal the infamy of a thief by showing him in good company, has deluded mankind by a superficial resemblance, to overlook the essential quality and primary design of fictitious capital. Even writers of high reputation have arranged credits between individuals, under the head of fictitious capital; such as bonds, notes, and bills of exchange; but they ought not to be placed there, unless they are forgeries. If they are genuine, they are honest exchangers of property, being merely an evidence, that for property delivered, other property, or its value, is to be returned. These papers are neither local, nor their acceptance compulsory, like paper money. Their credit arises from the property of individuals subject to their redemption, and is exposed to the decisions of free will. Whereas the credit of every species of fictitious capital, arises from delusion, and is more or less compulsory. Here we discern an impropriety in applying the term "confidence" indiscriminately to these two kinds of capital. Applied to the genuine species, including bonds, bills, and notes, it implies a belief, that the debtor possesses sufficient property to redeem his obligation; applied to the fictitious species, it implies a belief that the government will sustain its own fiction or forgery. A confidence in power, sustains fictitious capital. A necessity, caused by the laws for the introduction of fictitious capital, unites with power to give it currency, though we know it to be a vehicle for conveying our property into the pockets of others. An exclusion of real capital, an increase of fictitious, and an aggravation of taxation, unite to create this necessity. But this necessity is not confidence, though called so by those who inflict it, to transfer the odium from their own fraud, to the folly of a community; and to hide the compulsion under a veil like free will. Whenever the circulation of fictitious currency or capital is obstructed, governments, conscious that this property-transferring machine works for the conspiracy by which it is fabricated, protect their associates; not because they possess, but because they do not possess the public confidence. This legal interposition to enforce a system for transferring property, is ingeniously said by the Committee, "to trace the true principles of political economy to the conduct and interest of the individuals who compose the nation." The most eminent political writers have united in an opinion, that to govern too much is an error, and even tyrannical. How can government be pushed further, than into the very mouths of individuals? What other power can despotism need, after it has obtained a complete control over all the physical interests of the individuals who compose a nation? It boasts in the United States, that it leaves the mind free. The criminal extended on the rack still retains the freedom of his mind. Though confined in a dungeon upon bread and water, he may be of what religion he pleases. So bodies, impoverished, and sometimes starved by being encircled with the magical chains of exclusive privileges, may boast under the hardship of deprivations, that their minds are still free; that they can adore, though they cannot enjoy, those republican principles, which teach that governments ought to be instituted to secure the right of providing for our own wants, according to our own will, and not according to the will of the government; because such a power in the government, however it may leave the mind speculatively free, is a real despotism over both mind and body, since they are indissoluble except by death.
Tyranny is wonderfully ingenious in the art of inventing specious phrases to spread over its nefarious designs. "Divine right, kings can do no wrong, parliamentary supremacy, the holy alliance," are instances of it in Europe. "Common defence, general welfare, federal supremacy and political economy," are impressed into the same service here. When the delusion of one phrase is past, another is adopted to work out the same ends as its predecessor. Political economy is represented as a complicated system of deprivations and compensations, or of getting and giving back money. In the multitude of transactions implied by this notion of political economy, will none of it stick to the fingers through which it passes? Will the privileged bands of brokers get nothing by this economical traffick? Will the officers necessary to enforce this species of political economy, require no salaries? An economy exposed to endless frauds, and incomputable expenses. The pretence "that though it inflicts deprivations, it bestows compensations," is one of those gross impositions upon the credulity of mankind, believed upon no better grounds than the stories of ghosts and apparitions. In the history of the world, there is no instance of a political economy bottomed upon exclusive privileges, having made any compensation for the deprivations it inflicts. The Committee have likened it to household economy. What should we say of the household economist, who should keep a train of idle servants, surrender to them all his keys, entrust them with all his money, and buy of them all his necessaries at double prices? Would not his system of economy be the same with that of a nation, which creates a train of idle capitalists by exclusive privileges, surrenders to them all the keys of individual interest, intrusts them with its currency, and buys of them its necessaries at double prices? The similitude fails according to the Committee, because we choose our governments. But the individual also chooses his servants. Let us try it in another aspect. Suppose a train of servants, agents, or representatives; call them what you will, should offer their services to a wealthy individual, upon condition that they should have the power of prescribing to him in all his wants, of prohibiting some of his comforts, and of enhancing the price of others; would he believe that the proposal was made to advance either his wealth, liberty, or happiness? Again: Suppose our household economist had employed a train of servants, but upon the suggestion of another train desirous of getting into their places, that they were deranging his affairs, he should displace them and employ the friendly informers. If the new servants should embarrass his affairs more than the old did, would he say to them, "well done, ye good and faithful servants?" In all these views, household economy is no bad mirror for reflecting that species of political economy, managed by successive parties, as an engine for transferring property.
The Committee have untirely overlooked by far the most important branch of political economy, namely, the economy which teaches nations not to expend the principles which secure their liberty, in search of money. If we waste this treasure, under the idea that we shall thereby increase our treasure of currency, capital, or money, we should imitate the man who bestows the best part of his estate upon a swindler, because he promises to improve the residue. A waste of our republican principles certainly involves a waste of our money. Have the monopolies, extravagance, and exclusive privileges of European governments, saved the money of the people? No, but it is said, that the loss, both of liberty and money, caused by the political economy which minutely regulates the interest of individuals in Europe, proceeds from the badness of the governments, and that ours, being a good one, it can guard abuses against abuse, and make tyrannical principles the saviours of civil liberty. This very unpromising experiment, to make a blessing of actual tyranny by theoretical liberty, has never yet succeeded any where else, and the picture drawn by the Committee of the distress to which it has already conducted the United States, is a strong indication of the improbability of its success here. The endeavour to guard abuses against abuse, seems to be utterly hopeless, from our own experience. Specie payments was the guard against the abuse of banking, but the guard sleeps whenever the abuse requires it. The protecting-duty abuse, and the abuse of exclusive privileges, are guarded against abuse by our good theoretical governments, exactly as they are by the bad theoretical European governments. They are extended. The abuses of extravagance and borrowing, can grow under our governments, as fast as under those of Europe. In fact, the introduction of abuses, is an infallible prophet of their continuance. The nation which imagines that a government which introduces, will not foster them, or that a good government can by provisions convert fraud into honesty, relies upon a moral impossibility for the preservation of its liberty.
It is confessed, that the predilection of the Committee for foreign opinions or abuses, only extends to some of the modes for transferring property, by monopolies and exclusive privileges, without expressing an approbation of all. They have not approved of the regal, hierarchial, and sinecure modes, nor have they directly recommended chartered companies to carry on particular branches of foreign commerce. It may, however, be inferred from their approbation of a law charter to capitalists, conveying an exclusive privilege for carrying on many branches of domestick commerce, that they would have no objection to its own brothers and usual associates. But whatever modes of monopoly and exclusive privileges for transferring property they may love, and whatever modes they may hate, they have strenuously recommended one, which has become obsolete in England. Monopolies of domestick commerce, like our restrictions upon the importation of tobacco, have been tried and deserted in that country, and we are only dressing ourselves in our father's old clothes.
Chaptal*31 observes, "that the advantages which England derives from a system excluding competition in the markets, are, in preserving the workmanship which supports her population; and in being able to tax every thing that goes immediately into internal consumption." The superiority of our workmanship has not awakened a jealousy of its being copied by other nations. Our population is supported by agriculture, and this motive for imitating the English policy, could not be urged by the Committee. Its remaining advantage of taxing every thing which we consume, though it would not have advanced their object to make the most of that argument, is yet prospectively eulogised by a pleasant view of the English excise system, which, like the second curse inflicted upon the Egyptians, feeds upon mankind. Through a dark avenue of intimations, cautiously planted here and there in the report, and fearfully suggesting the deficiency of revenue resulting from the restrictive system, we clearly discern the English excise system, or the policy of taxing all internal consumptions. But out-stripping their model, the Committee propose to pay this excise twice over, though the English writhe under the agony of paying it only once. To get internal commodities for taxation, we are first to pay an enormous excise to capitalists, and when we come to consumption, another excise is to be paid to government, to supply the loss in the customs, produced by the first tax. Thus we shall be doubly exposed to this dark, expensive, vexatious, and oppressive mode of taxation. Whereas commercial restrictions in England do not enhance the prices of home consumptions to give an excise to capitalists, as their manufactures are cheaper than any they could import; and this cheapness has suggested to some other nations, like ourselves, prohibitions and restrictions upon English competition. As England undersells other nations, they cannot undersell her: wherefore she only pays an excise to her government, and the exclusion of foreign competition bestows no bounty or excise upon her capitalists. Their exclusive charter to manufacture certain articles is now a dead letter, but ours is a more enormous tax, than could be inflicted by conferring on a mercantile company, an exclusive privilege of carrying on any one branch of foreign commerce, because it embraces internal necessaries to a far greater extent, which are less capable of being renounced than foreign importations. Our sweeping domestick monopoly is exactly of the same character with that established by several despotick English kings, by grants or charters to individuals.
The Committee may therefore speak correctly, when they say, that they have no predilection for foreign opinions. In this view of the subject, they propose to introduce a species of monopoly which the English do not retain; and to discourage a species of industry, which the English have endowed with a monopoly. Not the manufacturing capitalists, but the landlords are enriched by a monopoly. Their exclusion of foreign manufactures does not enhance the price of domestick; but the exclusion of foreign corn does enhance the price of bread, and constitutes a tax or excise paid by its consumers; having the effect of a bounty to landlords by raising rents. But though the Committee deviate from the English policy, in their selection of the interest to be patronized, by sacrificing the land-owners to the capitalists, instead of sacrificing the consumers of bread to the landlords, they adhere to the principle of their corn laws.
The exclamations with regard to the English are curious. In that country the whole tribe of abusers are vociferating, "Oh! how happy we are." The sufferers from these abuses are groaning, "Oh! how miserable we are!" Here, monopolies, exclusive privileges, and extravagance, hold up the English happiness for our imitation, and our patriots represent English misery as highly to be deprecated. Is it not curious that the same foreign policy should furnish two comparisons; one to prove that we are a weak and miserable nation; the other that we are the wisest and happiest in the world?
The before-mentioned foreign political economist, Chaptal, regarded by capitalists as such an apostle of their creed (a creed for making themselves great pecuniary dignitaries) that they have translated, condensed, and published his doctrines, observes,
I grant it would have been wiser for each nation to confine its ambition to cultivating and perfecting that kind of labour, for which nature has particularly designed it; but all wish to obtain all kinds, and hence have arisen those principles of an interest badly understood, which isolates and reduces them to their own individual resources. I well know that the laws of nature are fixed, and that sooner or later every nation will resort to that species of industry she has marked out for it; but the evil is done, and the deviation of this departure from true principles will be much more considerable than is generally supposed. A nation which receives its manufactured articles from abroad, cultivates with care the productions of its soil to exchange them in return; this culture would be naturally more neglected, when the exportation is lessened by the refusal to admit foreign manufactures in exchange. We are not ignorant, besides how difficult it is to contract, and to resolve to sacrifice capitals, and annihilate manufacturing establishments when a nation has once engaged in a false route; her hasty change from it cannot be expected, unless by the will of the government, and the nation's recollection of its own interest.
This is a fair statement of the question, by a monarchical economist. Excluding those arguments resulting from the difference between a monarchical and republican form of government, he yet allows the exclusive-privilege system to be a false route. He admits it to be only defensible when it has been established, and asserts that every nation will return to that species of industry marked out by the laws of nature. The United States are at the crisis when they must determine whether they will persevere in this false route, or retrace their steps whilst they can. If we persevere, the difficulty of retraction will increase as it becomes more indispensable. The government will be implored in the names of good faith, of humanity, of honour, and of other virtues, impressed by self interest into a mercenary service, to sustain every abuse, monopoly, exclusive privilege, and extravagance, for transferring property, which it may have fatuitously established; and as its administrators always get a share of the spoil, they will be excessively charitable. The mammoth would have continued his ravages for ever, if his having been created, was a good reason for his perpetual existence. The wolf must be suffered to prowl without interruption after prey, because he exists. The sheep should even be forced into his jaws. In this doctrine lies the secret by which political devourers of the earnings of industry have been fed and multiplied. It is the cement of the holy alliance between frauds, abuses, and oppressions of every complexion, and of every degree of malignity to human happiness. The cruelty of restoring their own to the people, and of preferring the happiness of a multitude to the luxury of a few, causes the crocodile power, to shed affected tears of compassion, and is used for alluring unwary victims to their ruin. Chaptal uses England as a scare-crow to frighten France, not out of, but into the policy, which he says is a violation of the laws of nature. The Committee use England and other nations to frighten us into the same policy. And thus the folly is rolled from nation to nation, and generates abuses and tyranny in all its progress.
This doctrine of imitating errors has already conducted us to a crisis at which we must once more decide whether we will be a free nation. Freedom is not constituted solely by having a government of our own. Under this idea most nations would be free. We fought in the revolutionary war against exclusive privileges and oppressive monopolies. Will a monopoly which can tax internal consumptions to a vast extent, be less avaricious or less oppressive, than the similar monopoly of which the article of tea was designed to be the entering wedge? What a spectacle for the Deity do we exhibit? We beseech him to deliver us out of a gulf of distress, and plunge ourselves deeper and deeper into it. Are bad political principles infectious like the plague, and can our constitutions afford us only a quarantine against them of forty years, after which we are to use no precautions against their liberty-killing effect, in imitation of the apathy with which the Turks behold that body-killing pestilence?
Such is that species of political economy which pursues the money, the food, and the clothing of individuals. Like money, political economy has two souls. It can increase individual happiness by diffusing comforts, or it can destroy it, by accumulating capitals for a few. A species of political economy having the latter effect, is only another species of paper currency for transferring property and comforts. If no tyranny can be more complete and more tormenting, than one which dictates to individuals in all their comforts and enjoyments; which prohibits some and enhances the price of others to enrich capitalists; the argument that we ought to establish this tyrannical species of political economy, because other nations have done so, is precisely of the same value, as the argument for introducing monarchy, aristocracy, or any other species of oppression, because other nations have established them. If we are under the necessity of adopting bad principles, because other nations do not, or rather cannot adopt good principles, the progress of civil liberty is at an end. Must we go back to their bad political principles, because they are unable to proceed forward towards our good political principles? Why then, liberty must be abolished by tyranny and honest political economy, the ally of the former, must be supplanted by fraudulent political economy, the most powerful ally of the latter. The mind has full evidence in the experience of nations, upon which to decide between the species of political economy which breeds monopolies, enriches capitalists, and deprives the people of comforts; and that which leaves to individuals the free use of their earnings, undiminished by any legal transfers, the contributions excepted, necessary to sustain a free and frugal government.
The whole benefit supposed by the Committee to lie in the spurious kind of political economy, is to result from an exchange of the balance of liberty and comforts which we ought to possess under our constitutions, for a balance of trade with foreign nations. To advance this speculation, a moneyed aristocracy, already created, is to be made so strong as to place in our mouths a great number of padlocks, lest we should consume our earnings, instead of giving them to this aristocracy, that it may secure the coveted balance. The pecuniary balance in foreign trade thus obtained, would either be transitory or settle upon a pecuniary aristocracy, which would absorb the powers of government. But the balance of liberty and comforts surrendered to obtain it, as well as the pecuniary balance between a moneyed aristocracy and the people, is lost for ever. It is constantly repeated (an old story in Europe) that the capitalists will produce a home market, and compensate all other interests by purchasing their labours with their own money. If the argument is a good one, there can be no such thing as a pecuniary tyranny. Aristocracies of all sorts are not pecuniary frauds, because they eat. Hierarchies, bishops, and monks, are blessings, as they eat also. All the European monopolies, exclusive privileges, and sinecures, being composed of men, far from being oppressive or tyrannical, are only political economy, because they afford markets for those from whom the money is extorted, by which their products are purchased. It is the very argument which has been used time out of mind by all those governments whose maxims we scorn, and whose oppressions we condemn.
There are features in the species of political economy proposed by the Committee, very much resembling those which we have sometimes seen in stay-laws,*32 as they are called, but far more fraudulent. It proposes to meddle more deeply with the contracts of individuals, and to control far more extensively the freedom of will. These stay-laws have often enacted, that the property offered by individuals, shall be valued by disinterested appraisers, and that the creditor shall receive it at this valuation. By depriving the creditor of this right to judge for himself, he is frequently defrauded, and always compelled to take things badly constructed, which he does not want, or which he could obtain cheaper, had he retained the right of laying out his money according to his own judgment. The system of economy advocated by the Committee enables the capitalists to value their own goods, and compels the purchasers by prohibitions and restrictions, just as they were compelled by war, to purchase them at the valuation of the sellers, although except for this compulsion, they might have been gotten cheaper. The stay-laws are only defended as temporary expedients, and only borne because they are soon to expire. Our new system of political economy is proposed as a permanent policy. The stay-laws pretend to the benevolent intention of benefiting the poor, and relieving the distressed. Our system of compulsory political economy proposes to give bounties to the rich at the expense of the poor, to be exacted by their own consciences in the valuation of their own wares. The stay-laws are honest in theory, but fraudulent in operation. The compulsory system of political economy is foul in theory, and less fair in its operation between capitalists and consumers, than stay-laws between debtor and creditor. The stay-laws are a species of political economy, contrived to effect a transfer of property between individuals, without the free will which constitutes fair exchanges. The compulsory political economy of protecting duties, effects a transfer of property between a combination of capitalists and the rest of the nation, in which the freedom of will is all on one side. The valuation under the stay-laws may sometimes be in favour of the creditor. Under the compulsory system of political economy, it can never be in favour of the nation. The creditor, by a stay-law valuation, gets something for his demand. All that the capitalist gets by his own valuation, beyond the price at which the purchaser could have gotten the commodity, except for the compulsion bearing upon him, is a total loss to the purchaser, and an entire acquisition to the capitalist of so much of the purchaser's property. Such a system of political economy must obviously be more ruinous to all interests except the capitalists, than the stay-law economy is to creditors.
The principles of political economy, as advocated by the Committee, terminate in two conclusions; one, that of producing a pecuniary balance of foreign trade; the other, that this balance will be gained by manufactures. By the first, the honest species of internal political economy, must be destroyed; by the second, the efficacy of agricultural products in regulating the balance of foreign commerce, is wholly overlooked. However equivocal the term "manufactures" may be, yet, as the Committee have used it to distinguish between the different products of human labour, I shall adhere to it for the purpose of enquiring, whether those products to which they have exclusively applied it, are in fact more efficacious in acquiring a balance of trade, than those to which they deny such a power.
In ancient times, the products of agricultural industry greatly preponderated, and constituted nearly all the objects of commerce; in modern, though this preponderance is considerably diminished by the improvements in manufacturing, it must still be confessed, that they retain a considerable superiority in value. Tea, a single agricultural product, obtains for a great empire, a balance of trade in money. Spices do the same for Holland. Liquors, sugar, and coffee, are staples which bestow wealth on other countries. Cotton, tobacco, grain, meat, live stock, rice, fish, tar, pitch, turpentine, potash, timber, and other articles, are the means of the United States for procuring a balance of trade. Chaptal thinks, "that it would be wiser for a nation to cultivate and perfect that kind of labour for which nature designed it, than to seek for wealth by prohibitions and restrictions upon commerce." The Committee are for forcing nature out of her course, by discouraging the long list of occupations which she patronizes, and fostering one at their expense, upon which she must frown for ages. According to their doctrine, China ought to diminish the cultivation of tea, and other countries that of spices, sugar, and coffee. The United States also, ought to diminish the cultivation of the entire mass of articles, which bring them all the money and commodities they get by commerce, for the purpose of encouraging an occupation, by which they gain nothing from foreign nations. Their scheme is to diminish the whole mass of our exports, in order to increase a species of labour which furnishes but few; and they call it "political economy." As its hopefulness depends more on the degree of favour it may expect from the laws of nature, than on the power of legislation to defeat those laws, we ought maturely to consider what these laws now decree, how long it will take us to make them null and void, and what will be the expense of a legislative war with them.
The laws of nature operate upon a great variety of circumstances in respect to commerce, both moral and physical. Among these, extent of country and the number of inhabitants, are of irresistible force. The relation of these two circumstances to each other, determines her mandate on the subject we are discussing. We discover that relation by considering the difference between population and populousness. The population may be considerable, and yet a country may not be populous, comparatively with its extent. Such is our case. Whatever may be the actual census of the United States, yet a superabundance of uncultivated land, will long prevent them from being populous. To determine correctly how nature legislates in such a case, we must be governed by the character she has given to man. The first objects of his solicitude are, a home, independence, and leisure. Where land is good, cheap, and plenty, he will certainly estimate the prospect of acquiring these objects, either by becoming the owner of a farm, or a day labourer for hire. He will compare the beneficence of the Deity with the beneficence of a capitalist; and consider whether it is better to work himself for another, than to have the best labourer in the world, the earth itself, to work for him. He sees this good mother ready to supply him spontaneously with meat, butter, milk, honey, and many other comforts, not earned by labouring at the anvil, or toiling at the shuttle, for the live long day, and to repay bountifully his moderate exertions; and he will never be deprived of these blessings for which his heart pants, except by the tyranny of force, or the influence of bounties, equivalent to his sacrifices. As coercion cannot be used, he can only be assailed by bribes; but these will be intercepted by his master, because he cannot rival foreign nations, except by reducing the wages of his workmen to a level with theirs. In the interval, the cheapness of land must enhance the wages of mechanicks, and if the bounty should also get into the pockets of the workmen, it will accelerate their ability of acquiring the domicil for which their hearts languish. Have not the laws of nature decided, which is the best substratum for commercial rivalry and competition, cheapness or dearness? Shall we build up a competition with foreign nations upon the cheapness of our land, or upon the dearness of our manufactures, both destined to live for centuries, and slowly to disappear together? I cannot discern the impolicy of erecting our commercial competitions upon the cheapness of land, so long as it remains; and transplanting them to the cheapness of manufactures, whenever that shall occur in a natural course.
In addition, however, to the considerations arising from the present plenty of land and relative scarcity of people, we ought to take into view the permanent difference between maritime and inland countries. As the latter can never become considerable manufacturers for exportation, it would be as preposterous and unjust to impose the manufacturing occupation upon them, as to compel maritime countries to be agricultural. What must be the bounties which would enable our inland people to rival the English and other maritime nations, with our manufactures, in foreign nations? If they were sufficient to effect that object, with respect to our inland people, would they not be so superabundant to our maritime people, as to enable them to undersell and suppress their interiour competitors. The protecting-duty bounty would therefore be chiefly or entirely received by a slip of maritime country, inferiour to our inland country in extent and population; whilst the latter would be equally subjected to an excise system of taxation, without partaking of the bounty.
The political economy of procuring a balance of trade in our favour, by manufactures, can only be effected by their exportation, and until the object is thus accomplished, we must diminish the value and quantity of all exportable commodities, and subject all our consumption to a double excise, or all our lands to a direct tax. Chaptal justly observes "that a nation which receives its manufactured articles from abroad, cultivates with care the productions of its soil to exchange for them in return; this culture would naturally be more neglected, when the exportation is lessened by the refusal to admit foreign manufactures in exchange." The project of the Committee is to lessen the exportation of the productions of the soil by refusing to admit foreign manufactures in exchange for them, to cause their culture to be neglected by this effectual obstacle to their sale, to put a stop to the only means we have for drawing money, property, or capital from foreign nations, and to enable the class of capitalists to draw money, property, or capital from all other classes, by giving it an excise upon consumptions. This is a species of political economy which Chaptal seems to have overlooked.
The different modes in which governments have managed the machine called political economy, would suffice to fill volumes. In Russia, an empress declared from the throne "that the removal of agriculturists to towns, in order to follow manufacturing employments, greatly checked population, prevented the cultivation of large tracts of country, and impeded the prosperity of the empire to a great extent." Here it is contended "that the removal of agriculturists to towns and villages in order to follow manufacturing employments will advance the prosperity of the United States," although it will also check population, and prevent the cultivation of a larger and better extent of country. But the nobility of Russia, having a power of exacting from their boors an unlimited capitation tax called an obrok, obstructed the wise and benevolent designs of the empress, because they could extort a higher obrok from them by means of a manufacturing monopoly, than by agriculture. Here the capitalists, like the Russian nobility, are endeavoring to get agriculturists into factories, because they will be thereby enabled to draw more money from their labours than they could otherwise do. But they have outstripped the dull Russian nobility in acuteness, by obtaining an obrok to be levied upon those who will not go into their factories, by the protecting duties. What are poor mortals! The Russian obrok for enriching an ennobled class is universally admitted to be a grievous species of slavery; our obroks for enriching a privileged class of capitalists, is eulogized as an admirable species of political economy.
In England, the capitalists perceive that the importation of raw materials, duty free, will enable them to draw an higher obrok from their factory slaves. Here, the capitalists have discovered, that by diminishing the value of agricultural products, they can draw an obrok both from factory and agricultural workmen. And both of these contrivances are called political economy.
Russia, as I gather from its eulogist, Tooke, having a four-fold population beyond the United States, exports only one fourth as much in value. Her exports, like ours, are agricultural. By this exportation she is said to gain a small pecuniary balance of trade. Here it is supposed that a four-fold exportation of agricultural products by one fourth of people, must lose it. But it will be vehemently asserted by the protecting-duty policy, that Russia gains her annual trifling pecuniary balance by commercial prohibitions upon importations. The fact is doubtful; as even an indisposition for expensive consumption owing to the uncivilized state of the great mass of its people, and other causes, may very deeply affect it. But let it be admitted. Her exportations are sixteen-fold less than ours in proportion to population, and her duties only amount to three millions of dollars annually. To discover whether a small pecuniary balance of trade, thus procured, is a wise policy, we must compute the cost. First, the smallness of the agricultural exports, must be ascribed, as Chaptal observes, to the refusal of admitting foreign manufactures in exchange, and demonstrates that agriculture must be reduced to a very bad state. Secondly, the smallness of the importations demonstrates that forty millions of people can derive a very inconsiderable portion of comfort from other climates. And, thirdly, the prohibitions and restrictions upon commerce having rendered the customs wholly inadequate to the expenses of the government, a frightful catalogue of excises, obroks, and internal taxes of every description, has been created to supply the deficiency. The balance of trade in money is trifling compared with the oppressions arising from resorting to these resources, which it causes. These oppressions are permanent; and though Russia may get this small balance by inflicting them, she cannot prevent it from leaking out continually, so that she is obliged to resort to vast emissions of depreciating paper money. Besides, the commercial prohibitions and restrictions have reduced the price of agricultural products so low, as to inflict annually a pecuniary loss upon that one occupation, infinitely exceeding in amount the inconsiderable and fleeting pecuniary gain from a balance in trade. This part of the Russian policy, is the political economy recommended by the Committee. Even Russia is still obliged to take back many of her raw materials in a manufactured form, such as iron, furs, and wool, because the laws of nature have hitherto decided that she shall not be an exporting manufacturing country.
Athens, Carthage, and Holland, being deficient in commodities, both agricultural and manufactured, resorted to a free trade, and availed themselves of their maritime situations to excite industry by the utmost latitude both as to exports and imports. These examples of political economy have been admired by all the world. They raised three small barren districts to wealth and power. One was raised out of the sea. What then would be the consequence if we should unite the policy by which they flourished, to the advantage of possessing an extensive and fertile country, producing many indigenous commodities; when these little districts found it so efficient without such powerful auxiliaries?
Russia had no money when she had no trade. If a small trade will procure some money, a great trade will procure more. As we have no mines, the Committee propose to get money by diminishing trade. Suppose we had enough to facilitate domestick exchanges; ought trade to be therefore diminished? If so, the same reason would dictate its entire abolition. What will the money then be? As valuable and not more so than local paper money answering the end of facilitating local exchanges. Why is it true that money is every thing? Because it may be expended in obtaining comforts from foreign nations. Metallick money, locked up by commercial restrictions, is nothing in reference to other nations, beyond local paper money. Nations are individuals in relation to each other, and in locking up money, would act as wisely as an individual who should keep his money in a chest during his whole life. This is the political economy, for the sake of which we are advised to subject ourselves to the taxation of internal monopolies and exclusive privileges.
It is urged that governments ought to supervise the affairs of individuals, and that in order to promote their prosperity, they should give bounties to domestick obstacles, to be paid by domestick facilities, in order to enable these obstacles to undersell foreign facilities. By this policy the impracticability of equalizing climates, soils, situations, habits, and arts, is undertaken: and that, which, to a benevolent mind is still more beautiful, it will rob the ocean of its terrors, so soon as it is effected by all nations; and it may thenceforth roar and rage without swallowing up any more victims. The rival policy advises governments either to encourage the natural facilities of a nation, or at least to suffer them to produce as great a surplus as they can, to be exchanged for the facilities of other nations. If one of these systems of political economy is in its senses, the other must be run mad. No! It is not mad: It is an acute artifice practised by governments, under pretence of supervising the affairs of individuals, to enrich themselves, and their instruments of oppression.
The effects of bounties upon either imports or exports, are often very far from promoting the wealth or happiness of the nation which pays them. The consuming or exporting nation frequently receives these bounties from the paying nation, as in the cases of the bounties paid by England on the exportation of Irish linen, or the importation of corn. If the system of political economy recommended by the Committee, in the long, long run, should so completely succeed, as to enable the capitalists to become exporters of manufactures, the bounties preceding that distant epoch will have been paid to them, that foreign nations may receive those which shall succeed it. Drawbacks of duties, on the contrary, are allowed to be highly beneficial to commerce. These are special acts of freedom. Ought not the advantages resulting from them to suggest at least a drawback of all duties beyond the demands of revenue, as likely to have a similar effect upon commerce? It would be a general freedom.
There remains an argument if founded in fact, sufficient to overturn the whole theory of the Committee: and it seems perfectly plain to me, that the fact sustains the argument. The Committee say "that they have applied reasoning to facts, and traced the true principles of political economy to the conduct and the interest of the individuals who compose the nation." Let us adopt this correct principle, and consider whether the Committee have applied it so as to effect or defeat their object of procuring a balance of trade in our favour, from foreign nations. They contend, as is certainly true, that national political economy must have its source in the individuals who compose the nation, and therefore they go in search of it to "the conduct and interest of these individuals." Unless these individuals have a surplus of income beyond their expenses, the nation cannot acquire a balance of trade in its favour, because a national surplus, like a river, can only be formed by the streamlets of individual surpluses. If these rills are diverted into other channels, the river becomes dry. Suppose the income of an individual to be one thousand dollars, and his expenses eight hundred, two hundred would be his surplus applicable to the attainment of a balance of trade, and if so applied would draw from foreign nations money or property to that amount. But if he should be robbed of this surplus, he could not contribute any thing towards this object. Extend the supposition "to all the individuals who compose the nation" and, though each should, by his industry, procure a surplus beyond his expenses, yet if all are robbed of their several surpluses, none would have any thing applicable to the attainment of a balance of trade. The application is obvious. Whenever the profits of industry are transferred to monopolies, exclusive privileges, or public extravagance, the same amount is deducted from its means to procure for the nation a balance of trade. If the people of the United States are at this time paying thirty millions annually to banking pensions, the protecting-duty monopoly, and unnecessary public expenditures, it takes from individuals the same sum, which would otherwise have been applicable to the object of obtaining a favourable balance of trade, and applies it to the very different object of enriching a capitalist. Thus the theory is a felo de se, and inconsistent with the principle of tracing "political economy to the conduct and interest of individuals." It traces it on the contrary to the conduct and interest of a combination of factory capitalists. It proposes to acquire a balance of trade by transferring the means for doing so, to a totally different object. Would not individuals be more able to contend for this balance with thirty millions, or whatever the sum transferred may be, than without it? Besides, in this contest they would receive an equivalent for their surpluses, which would advance their own interest, and that interest is the end of true political economy. But when their surpluses are transferred by laws to enrich any minor class in society, they get no equivalent for them, and their conduct has nothing to do in the affair. They are only passive instruments of fraudulent laws. It is unimportant to true political economy or national prosperity, whether the surpluses of individuals shall be applied to getting money or commodities from foreign nations, to building houses, or to other improvements; applied in either mode it is a substantial political economy, and a sound item in computing the balance of trade. But if these surpluses are transferred to exclusive privileges or lavished upon a sect of capitalists, they cannot be applied in either mode towards advancing this kind of political economy. During our colonial state, though the pecuniary balance of trade was against the provinces, the political economy of not transferring the surpluses of individuals to unproductive legal creatures, overbalanced the loss, and caused commerce to be so highly beneficial to the provinces, that they speedily grew up to be a match for the mother country, and surprised the world by the celerity of their improvement. Now, the fraudulent species of political economy transfers these surpluses to a large family of unproductive legal creatures, and our prosperity stops, because the profits of labour, heretofore applicable to the objects of drawing money or property from foreign nations, or improving our country, are diverted to, and exhausted by, this consuming family.
To obtain a distinct view of the oppressive system of commercial restrictions commenced about thirty years ago, and prosecuted to an issue widely different from what its authors contemplated, until it has made matter for another Paradise Lost, we have only to recollect that human happiness must consist of temporal gratifications. We can only extract from human nature itself a perfect test, by which to distinguish the honest and true, from the false and fraudulent species of political economy. If such a test is not to be found in the difference between privations and gratifications, I know not where it lies. A political economy for securing and increasing our gratifications, as we pass through this world, is exactly the adversary of a political economy for inflicting and increasing privations. One must therefore be a true, and the other a false, species of political economy. We have only to ask ourselves whether our gratifications or privations have been increased by commercial restrictions, to discover the species of political economy to which they belong. The embargo preceding the last war cost me, by a calculation which I believe to be correct, considerably more than my proportion of the expenses of the war itself. But it enriched capitalists. Commercial restrictions are all partial embargoes; but they will also enrich the capitalists. A complete embargo is a respectable witness to prove what are the effects of partial embargoes, because the latter only graduate the effects produced by a general policy of the same nature. These probably deprive individuals of as much annually as would pay their taxes, or purchase gratifications to the same amount. A species of political economy which inflicts privations on the present, under pretence of bestowing gratifications upon some future generation, is false, because it robs men of the only gratifications of which they are susceptible, and it ought to be distrusted, because it is not exposed to the least responsibility. If it fails to fulfill its promise, who are to be impeached? Its authors are in the grave. It may promise whatever its designs may require, without being deterred even by the fear of reproach, because the excuse "that the time is not yet come to exhibit the goodness of the system" is always ready. But when the temptation of acquiring wealth, is added to its incongruity with human nature, and to the absence of responsibility, it becomes highly suspicious. The political economy of the Committee inflicts innumerable privations on the existing generations, defended by a promise of making compensation after the Committee and the sufferers are dead; and also bestows eagerly-solicited gratifications on the existing sect of capitalists. As to the capitalists, it adheres to the principle of true political economy, in dealing out present gratifications to living people; but as to the rest of the nation, it rejects this principle, and adopts that of the false species of political economy, by dealing out present privations to living people. But justice requires that a system of political economy, like a system of government, should be founded in one principle, so as to operate upon all the living members of the society equally, and not dispense wealth and gratifications to a few, and poverty and privations to a multitude, under pretence that the account shall be settled with the unborn, and the balance paid by the bankruptcy of the grave. Gratifications should be bestowed upon all living people, or upon none, by a true political economy; and it should also inflict privations upon all, or none, because it is the very essence of tyranny to inflict privations, in order to reap or to bestow gratifications.
It is unnecessary to prove that political economy, in all countries, is capable of being founded in the same principles, and ought to result from the same theory and it is sufficient to show a difference in the circumstances of different countries, in order to evince the species of political economy practicable in each. All the European writers upon political economy have extracted their systems from, and laboured to accommodate them to, local existing circumstances. Taking England for an example, and comparing it with the United States, these are so dissimilar, that a system of political economy, for that country cannot be suitable for this; and therefore an imitation by either of the other would be preposterous. England has two great interests, landlords and tenants, which are extensively computed in moulding her system of political economy; the yeomanry of the United States are land-owners, and must long continue so; wherefore rents are not an item of any importance, in moulding our system of political economy. Labour in England is environed by a multitude of laws, and must therefore be regulated by its system of political economy being free here, it requires no such regulation. England abounds in political orders and exclusive privileges, of an influence to be considered and provided for: the United States have no such orders, and ought not to have any such exclusive privileges. These English orders and privileges are so interwoven with the form of government, that their preservation is a primary object with the English system of political economy, which must be calculated either to effect this end or to produce a revolution; nothing equivalent to these orders or privileges is interwoven with our form of government by our constitutions, and to create and provide for them by a legal system of political economy, would be a substantial revolution. We have no tribes of tenants, labourers, and mechanics, panting for a revolution, and breaking out into frequent seditions to be restrained by a system of political economy; England is under the necessity of maintaining a standing army both to repress their turbulence and for self-defence against powerful neighbours. These and other local circumstances are dictators to her writers upon political economy, but no dictators to us; and therefore neither reason nor power requires us to adopt the system of political economy, which they are compelled by both to defend and recommend.
Let us now proceed to a separate examination of the answers given by the Committee to certain objections urged against the restrictive system, which they have selected as most answerable. They amount to nine, namely that the protecting-duty system is unconstitutional; injurious to morals, and productive of pauperism; improper to be extended; [a cause for smuggling;] a tax on the many, and a bounty to the few; a restrictive system; a destroyer of revenue; ruinous to commerce; and destructive to agriculture. Of all these crimes, the Committee contend that it is as innocent as the child unborn. If it can yet hide its future features in the womb, or excuse its present frolicks by its childhood, when it has grown up to maturity, it will hardly be acquitted, by an impartial judge, of any one. In considering the allegations of the Committee under these heads, an occasional recurrence to the principles we have passed over, will be unavoidable for the sake of their applications to new suggestions.
Notes for this chapter
Jean Antoine Chaptal (1756-1832), French chemist and, under Napoleon, minister of the interior and director of commerce and manufactures; author of On French Industry (2 vols., 1819).
Stay-laws were passed by legislatures generally to postpone trials or the execution of judgments in debt cases. Advocates claimed that they were only temporary relief measures, passed during agriculturally depressed times. Critics contended that the prodebtor legislation compromised the ability of creditors to recover debts.
End of Notes
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