Life of Adam Smith

Rae, John
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NOTWITHSTANDING the patronage he received from Lord North and his relations of friendship and obligation with the Duke of Buccleugh and Henry Dundas, Smith continued to be a warm political supporter of the Rockingham Whigs and a warm opponent of the North ministry. The first Earl of Minto (then Sir Gilbert Elliot) visited Edinburgh in 1782, and wrote in his journal. "I have found one just man in Gomorrah, Adam Smith, author of the Wealth of Nations. He was the Duke of Buccleugh's tutor, is a wise and deep philosopher, and although made Commissioner of the Customs here by the Duke and Lord Advocate, is what I call an honest fellow. He wrote a most kind as well as elegant letter to Burke on his resignation, as I believe I told you before, and on my mentioning it to him he told me he was the only man here who spoke out for the Rockinghams."*68 This letter is now lost, but Burke's answer to it remains, and was sold at Sotheby's a few years ago. Smith must have expressed the warmest approval of the step Fox and Burke had taken, on the death of the Marquis of Rockingham in July 1782, in resigning their offices in the Ministry rather than serve under their colleague Lord Shelburne, and he must have felt strongly on the subject to overcome his aversion to letter-writing on the occasion. Fox and Burke have been much censured for their refusal to serve under Shelburne, inasmuch as that refusal meant a practical disruption of the Whig party; and Burke could not help feeling strengthened, as he says he was in his letter, by the approval of a man like Smith, who was not only a profound political philosopher, but a thorough and loyal Whig. Notwithstanding his personal friendship with Lord Shelburne, Smith never seems to have trusted him as a political leader. We have already seen him condemning Shelburne at the time of that statesman's first collision with Fox—the "pious fraud" occasion—and now nineteen years later he shows the same distrust of Shelburne, and doubtless for the same reason, that he believed Shelburne was willing to be subservient to the king's designs, and to increase the power of the Crown, which it had ever been the aim of the Whigs to limit. Shelburne's acceptance of office, after the king's positive refusal to listen to the views of the Rockinghams themselves regarding the leadership of their own party, was probably regarded by Smith as a piece of open treason to the popular cause, and open espousal of the cause of the Court.


In those critical times the thoughts of even private citizens brooded on the arts of war. An Edinburgh lawyer who had never been at sea invented the system of naval tactics which gave Rodney his victories, and here is a Highland laird, who had spent his days among his herds in Skye, writing Smith about a treatise he has composed on fortification, which he believes to contain original discoveries of great importance, and which he sends up to Smith and Henry Mackenzie, with a five-pound note to pay the expenses of its publication. The author was Charles Mackinnon of Mackinnon, the chief of his clan, who fell into adverse circumstances shortly after the date of this correspondence, and parted with all the old clan property, and the treatise on fortification itself still exists among the manuscripts of the British Museum. It is certainly a poor affair, from which the author could have reaped nothing but disappointment, and Smith, who seems to have held Mr. Mackinnon in high esteem personally, strongly dissuades him from giving it to the press. This opinion is communicated in the following candid but kind letter:—

DEAR SIR—I received your favour of the 13th of this month, and am under some concern to be obliged to tell you that I have not only not got out of the press, but that I have not yet gone into it, and would most earnestly once more recommend it to your consideration whether upon this occasion we should go into it at all. It was but within these few days that I could obtain a meeting with Mr. Mackinzie, who was occupied with the Ex-chequer Business. I find he had seen your papers before, and was of the same opinion with me that in their present condition they would not do you the honour we wish you to derive from whatever work you publish. We read them over together with great care and attention, and we both continued of our first opinion. I hope you will pardon me if I take the liberty to tell you that I cannot discover in them those original ideas which you seem to suppose that they contain. I am not very certain whether I understand what you hint obscurely in your former letter, but it seems to me as if you had some fear that some person might anticipate you, and claim the merit of your discoveries by publishing them as his own. From the character of the gentleman to whom your property has been communicated, I should hope there is no danger of this. But to prevent the Possibility of the Public being imposed upon in this manner, your Papers now lie sealed up in my writing Desk, superscribed with directions to my executors to return them unopened to you or your heirs as their proper owners. In case of my death and that of Mr. M'Kinzie, the production of these papers under my seal and superscribed by my hand will be sufficient to refute any plagiarism of this kind. While we live our evidence will secure to you the reputation of whatever discoveries may be contained in them. I return you the five Pound note, in hopes that you will not insist upon this publication, at least for some time; at any rate, I shall always be happy to advance a larger sum upon your account, though I own I could wish it was for some other purpose. I have not shown your Papers to Smellie. It will give me great pleasure to hear from you, and to be informed that you forgive the freedom I have used in offering you, I am afraid, a disagreeable advice. I can assure you that nothing but the respect which I think I owe to the character of a person whom I know to be a man of worth, delicacy, and honour, could have extorted it from me.—I ever am, dear sir, most faithfully yours,

21st August 1782.

If you should not chuse that your Papers should remain in my custody, I shall either send them to you or deliver to whom you please.*69


While one Highland laird was planning to save his country by an improved system of fortification, another was conceiving a grander project of saving her by continental alliances. The moment was among the darkest England has ever passed through. We were engaged in a death-struggle against France, Spain, and the American colonies combined. Cornwallis had just repeated at Yorktown the humiliating surrender of Burgoyne at Saratoga. Elliot lay locked in Gibraltar. Ireland was growing restive and menancing on one side, and the Northern powers of Europe on the other—the Armed Neutrality, as they were called—sat and watched, with their hands on their sword-hilts and a grudge against England in their hearts. Now Sir John Sinclair believed that these neutral powers held the key of the situation, and wrote a pamphlet in 1782, which he proposed to translate into their respective tongues for the purpose of persuading them to join this country in a crusade against the House of Bourbon, and "to emancipate the colonies both in the West Indies and on the continent of America for the general interest of all nations." The price he was prepared to offer these powers for their adhesion was to be a share in the colonial commerce of England, and the acquisition of some of the French and Spanish colonial dependencies for themselves. Sinclair sent his pamphlet to Smith, apparently with a request for his opinion on the advisability of translating it for the conversion of the powers, and he received the following reply. I may add that I have not been able to see this pamphlet, but that it is evidently not the pamphlet entitled "Impartial Considerations on the Propriety of retaining Gibraltar," as Sinclair's biographer supposes; for in the former pamphlet Sinclair is advocating not only a continuance, but an extension of the war, whereas in the latter he has come round to the advocacy of peace, and instead of contemplating the deprivation of France and Spain of their colonies, he recommends the cession of Gibraltar as a useless and expensive possession, using very much the same line of argument which Smith suggests in this letter. Smith's letter very probably had some influence in changing his views, though it is true the idea of ceding Gibraltar was in 1782 much favoured by a party in Lord Shelburne's government, and even by the king himself.


Smith's letter ran thus:—

MY DEAR SIR—I have read your pamphlet several times with great pleasure, and am very much pleased with the style and composition. As to what effect it might produce if translated upon the Powers concerned in the Armed Neutrality, I am a little doubtful. It is too plainly partial to England. It proposes that the force of the Armed Neutrality should be employed in recovering to England the islands she has lost, and the compensation which it is proposed that England should give for this service is the islands which they may conquer for themselves, with the assistance of England indeed, from France and Spain. There seems to me besides to be some inconsistency in the argument. If it be just to emancipate the continent of America from the dominion of every European power, how can it be just to subject the islands to such dominion? and if the monopoly of the trade of the continent be contrary to the rights of mankind, how can that of the islands be agreeable to these rights? The real futility of all distant dominions, of which the defence is necessarily most expensive, and which contribute nothing, either by revenue or military forces, to the general defence of the empire, and very little even to their own particular defence, is, I think, the subject on which the public prejudices of Europe require most to be set right. In order to defend the barren rock of Gibraltar (to the possession of which we owe the union of France and Spain, contrary to the natural interests and inveterate prejudices of both countries, the important enmity of Spain and the futile and expensive friendship of Portugal) we have now left our own coasts defenceless, and sent out a great fleet, to which any considerable disaster may prove fatal to our domestic security; and which, in order to effectuate its purpose, must probably engage a fleet of superior force. Sore eyes have made me delay writing to you so long.—I ever am, my dear sir, your most faithful and affectionate humble servant,

14th October 1782.*70


The strong opinion expressed in this letter of the uselessness of colonial dependencies, which contributed nothing to the maintenance of the mother country, had of course been already expressed in the Wealth of Nations. "Perish uncontributing colonies" is the very pith of the last sentence of that work. "If any of the provinces of the British Empire cannot be made to contribute towards the support of the whole empire, it is surely time that Great Britain should free herself from the expense of defending those provinces in time of war and of supporting any part of their civil or military establishments in time of peace; and endeavour to accommodate her future views and designs to the real mediocrity of her circumstances."


The principles of free trade presently got an impetus from the conclusion of peace with America and France in 1783. Lord Shelburne wrote Abbé Morellet in 1783 that the treaties of that year were inspired from beginning to end by "the great principle of free trade," and that "a peace was good in the exact proportion that it recognised that principle." A fitting opportunity was thought to have arisen for making somewhat extended applications of the principle, and many questions were asked about how far such applications should go in this direction or that. When the American Intercourse Bill was before the House in 1783, one of Lord Shelburne's colleagues in the Ministry, William Eden, approached Smith in considerable perplexity as to the wisdom of conceding to the new republic free commercial intercourse with this country and our colonies. Eden had already done something for free trade in Ireland, and he was presently to earn a name as a great champion of that principle, after successfully negotiating with Dupont de Nemours the Commercial Treaty with France in 1786; but in 1787 he had not accepted the principle so completely as his chief, Lord Shelburne. Perhaps, indeed, he never took a firm hold of the principle at any time, for Smith always said of him, "He is but a man of detail."*71 Any-how, when he wrote Smith in 1783 he was under serious alarm at the proposal to give the United States the same freedom to trade with Canada and Nova Scotia as we enjoyed ourselves. Being so near those colonies, the States would be sure to oust Great Britain and Ireland entirely out of the trade of provisioning them. The Irish fisheries would be ruined, the English carrying trade would be lost. The Americans, with fur at their doors, could easily beat us in hats, and if we allowed them to import our tools free, they would beat us in everything else for which they had the raw materials in plenty. Eden and Smith seem to have exchanged several letters on this subject, but none of them remain except the following one from Smith, in which he declares that it would be an injustice to our own colonies to restrict their trade with the United States merely to benefit Irish fish-curers or English hatters, and to be bad policy to impose special discouragements on the trade of one foreign nation which are not imposed on the trade of others. His argument is not, it will be observed, for free trade, which he perhaps thought then impracticable, but merely for equality of treatment,—equality of treatment between the British subject in Canada and the British subject in England, and equality of treatment between the American nation and the Russian, or French, or Spanish.

DEAR SIR—If the Americans really mean to subject the goods of all different nations to the same duties and to grant them the same indulgence, they set an example of good sense which all other nations ought to imitate. At any rate it is certainly just that their goods, their naval stores for example, should be subjected to the same duties to which we subject those of Russia, Sweden, and Denmark, and that we should treat them as they mean to treat us and all other nations.


What degree of commercial connection we should allow between the remaining colonies, whether in North America or the West Indies, and the United States may to some people appear a more difficult question. My own opinion is that it should be allowed to go on as before, and whatever inconveniences result from this freedom may be remedied as they occur. The lumber and provisions of the United States are more necessary to our West India Islands than the rum and sugar of the latter are to the former. Any interruption or restraint of commerce would hurt our loyal much more than our revolted subjects. Canada and Nova Scotia cannot justly be refused at least the same freedom of commerce which we grant to the United States.


I suspect the Americans do not mean what they say. I have seen a Revenue Act of South Carolina by which two shillings are laid upon every hundredweight of brown sugar imported from the British plantations, and only eighteenpence upon that imported from any foreign colony. Upon every pound of refined sugar from the former one penny, from the latter one halfpenny. Upon every gallon of French wine twopence; of Spanish wine three-pence; of Portuguese wine fourpence.


I have little anxiety about what becomes of the American commerce. By an equality of treatment of all nations we must soon open a commerce with the neighbouring nations of Europe infinitely more advantageous than that of so distant a country as America. This is an immense subject upon which when I wrote to you last I intended to have sent you a letter of many sheets, but as I expect to see you in a few weeks I shall not trouble you with so tedious a dissertation. I shall only say at present that every extraordinary, either encouragement or discouragement that is given to the trade of any country more than to that of another may, I think, be demonstrated to be in every case a complete piece of dupery, by which the interest of the state and the nation is constantly sacrificed to that of some particular class of traders. I heartily congratulate you upon the triumphant manner in which the East India Bill has been carried through' the Lower House. I have no doubt of its passing through the Upper House in the same manner. The decisive judgment and resolution with which Mr. Fox has introduced and supported that Bill does him the highest honour.—I ever am, with the greatest respect and esteem, dear sir, your most affectionate and most humble servant,

EDINBURGH, 15th December 1783.*72


Fox's East India Bill, of which Smith expresses such unqualified commendation, proposed to transfer the government of British India from the Court of Directors of the East India Company to a new board of Crown nominees. This measure was entirely to Smith's mind. He had already in the former editions of his book condemned the company which, as he says, "oppresses and domineers in India," and in the additional matter which he wrote about the company immediately before this bill was introduced he declared of them that "no other sovereigns ever were, or, from the nature of things, ever could be, so perfectly indifferent about the happiness or misery of their subjects, the improvement or waste of their dominions, the glory or disgrace of their administration, as, from irresistible moral causes, the greater part of the proprietors of such a mercantile company are and necessarily must be."

Notes for this chapter

Lady Minto's Life of the Earl of Minto, i. 84.
Add. MSS., 5035.
Correspondence of Sir John Sinclair, i. 389.
Mackintosh, Miscellaneous Works, iii. 17.
Journals and Correspondence of Lord Auckland, i. 64.

Chapter XXVII

End of Notes

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