"To the Honourable the Commons, &c., the Petition of the Merchants of the City of London.
"Sheweth,
"That foreign commerce is eminently conducive to the wealth and prosperity of a country, by enabling it to import the commodities for the production of which the soil, climate, capital, and industry of other countries are best calculated, and to export, in payment, those articles for which its own situation is better adapted.
"That freedom from restraint is calculated to give the utmost extension to foreign trade, and the best direction to the capital and industry of the country.
"That the maxim of buying in the cheapest market, and selling in the dearest, which regulates every merchant in his individual dealings, is strictly applicable, as the best rule for the trade of the whole nation.
"That a policy founded on these principles would render the commerce of the world an interchange of mutual advantages, and diffuse an increase of wealth and enjoyments among the inhabitants of each state.
"That, unfortunately, a policy the very reverse of this has been and is more or less adopted and acted upon by the government of this and every other country; each trying to exclude the productions of other countries, with the specious and well-meant design of encouraging its own productions: thus inflicting on the bulk of its subjects, who are consumers, the necessity of submitting to privations in the quantity or quality of commodities; and thus rendering what ought to be the source of mutual benefit and of harmony among states, a constantly recurring occasion of jealousy and hostility.
"That the prevailing prejudices in favour of the protective or restrictive system may be traced to the erroneous supposition that every importation of foreign commodities occasions a diminution or discouragement of our own productions to the same extent; whereas it may be clearly shown, that, although the particular description of production which could not stand against unrestrained foreign competition would be discouraged, yet, as no importation could be continued for any length of time without a corresponding exportation, direct or indirect, there would be an encouragement for the purpose of that exportation, of some other production to which our situation might be better suited; thus affording at least an equal, and probably a greater, and certainly a more beneficial, employment to our own capital and labour.
"That of the numerous protective and prohibitory duties of our commercial code, it may be proved that, while all operate as a very heavy tax on the community at large, very few are of any ultimate benefit to the classes in whose favour they were originally instituted, and none to the extent of the loss occasioned by them to other classes.
"That among the other evils of the restrictive or protective system, not the least is that the artificial protection of one branch of industry or source of production against foreign competition, is set up as a ground of claim by other branches for similar protection; so that, if the reasoning upon which these restrictive or prohibitory regulations are founded were followed out consistently, it would not stop short of excluding us from all foreign commerce whatsoever. And the same train of argument, which, with corresponding prohibitions and protective duties, should exclude us from foreign trade, might be brought forward to justify the re-enactment of restrictions upon the interchange of productions (unconnected with public revenue) among the kingdoms composing the union, or among the counties of the same kingdom.
"That an investigation of the effects of the restrictive system at this time is peculiarly called for, as it may, in the opinion of your petitioners, lead to a strong presumption that the distress which now so generally prevails is considerably aggravated by that system; and that some relief may be obtained by the earliest practicable removal of such of the restraints as may be shown to be most injurious to the capital and industry of the community, and to be attended with no compensating benefit to the public revenue.
"That a declaration against the anti-commercial principles of our restrictive system is of the more importance at the present juncture; inasmuch as, in several instances of recent occurrence, the merchants and manufacturers of foreign countries have assailed their respective governments with applications for further protective or prohibitory duties and regulations, urging the example and authority of this country, against which they are almost exclusively directed, as a sanction for the policy of such measures. And certainly, if the reasoning upon which our restrictions have been defended is worth anything, it will apply in behalf of the regulations of foreign states against us. They insist on our superiority in capital and machinery, as we do upon their comparative exemption from taxation; and with equal foundation.
"That nothing would tend more to counteract the commercial hostility of foreign States, than the adoption of a more enlightened and more conciliatory policy on the part of this country.
"That although, as a matter of mere diplomacy, it may sometimes answer to hold the removal of particular prohibitions, or high duties, as depending upon corresponding concessions by other states in our favour, it does not follow that we should continue our restrictions in cases where the desired concessions on their part cannot be obtained. Our restrictions would not be the less prejudicial to our own capital and industry, because other governments persisted in preserving impolitic regulations.
"That, upon the whole, the most liberal would prove to be the most politic course on such occasions.
"That, independent of the direct benefit to be derived by this country on every occasion of such concession or relaxation, a great incidental object would be gained, by the recognition of a sound principle or standard, to which all subsequent arrangements might be referred; and by the salutary influence which a promulgation of such just views, by the legislature and by the nation at large, could not fail to have on the policy of other states.
"That in thus declaring, as your petitioners do, their conviction of the impolicy and injustice of the restrictive system, and in desiring every practicable relaxation of it, they have in view only such parts of it as are not connected, or are only subordinately so, with the public revenue. As long as the necessity for the present amount of revenue subsists, your petitioners cannot expect so important a branch of it as the customs to be given up, nor to be materially diminished, unless some substitute less objectionable be suggested. But it is against every restrictive regulation of trade, not essential to the revenue, against all duties merely protective from foreign competition, and against the excess of such duties as are partly for the purpose of revenue, and partly for that of protection, that the prayer of the present petition is respectfully submitted to the wisdom of parliament.
“May it therefore, &c.”
In order to see how extensively and how effectually governments have interfered to pervert the natural distribution of the gifts of Providence, it would be necessary to review almost the whole list of spontaneous and artificial productions; for there are few or none whose spread has not been arbitrarily stopped in one direction or another. What Great Britain alone,—the most enlightened of commercial countries,—has done in damming up the streams of human enjoyment, is fearful to think of. In the vineyards of France and Portugal, the grapes have been trodden to waste, and the vinedressers’ children have gone half clothed, because wines were not permitted to be brought in, and cottons and woollens were thereby forbidden to be carried out, at their natural cost. During the long series of years that good tea has been a too costly drink for many thousands of our population, they would have been glad of the refreshment of chocolate, in some of its various preparations, if Spain had been permitted to send it to us from her colonies as cheap as Spain was willing to afford it. But the article has been loaded with a duty amounting to from 100 to 230 per cent.; so that few but the rich could ever taste it; and they have been swallowing a curious compound of the nut, flour, and Castile soap. The silkworms of Italy would have wrought as busily for England as for France, if England had not been jealous of France, and thereby injured her own manufacture. England is wiser now, and new myriads of worms are hanging their golden balls on the mulberry trees, while the neighbouring peasantry are enjoying the use of our hardware, and looms are kept busy in Spitalfields. Time was when the northern nations welcomed our manufactures in return for their timber and iron of prime quality: but now, the ship and house-builders must pay higher for worse wood from Canada; and we have laid exorbitant duties on foreign iron, in order to encourage mining at home. The good people of Sweden and Norway, having nothing to offer us but timber and iron, must do without our manufactures; and thus are willing nations prevented from helping one another. Whatever may be thought of the indulgence of opium in this country, no one objects to its being used by the Hindoo and the Chinese as a stimulus appropriate to the climate in which they dwell. If we had allowed things to take their natural course, Persian husbandmen would have tended their vast poppy-fields, season by season, guarding the delicate plant from the injuries of insects, and sheltering it from unfavourable winds, while the Chinese and the Hindoos would have been busy preparing commodities to exchange with the Persian, and all would have been made rich enough by their traffic to keep British merchant-ships continually going and coming to supply their wants. But our India Company has chosen to force and monopolize the culture of opium. It has beggared and enslaved many thousands of reluctant cultivators; narrowed the demand; lessened its own revenue, year by year, and just lived to see China freely supplied with Turkey opium by American traders. Thousands of our lowly brethren in Hindostan and Ceylon have dropped unnoticed out of life because they have not been permitted to touch the crisped salt beneath their feet, or to pluck the spices which perfume the air they breathe. Millions more have sunk at the approach of famine, because no labour of theirs was permitted to provide them with what might be exchanged for food from some neighbouring coast.
It is difficult to say whether we have injured China or Great Britain the most by our extraordinary fancy of sending functionaries invested at once with political and commercial power into a country where commerce is held by far too degrading an employment to be associated with political functions. This blunder was made by our monopolists, who were, but lately, keeping up a splendid establishment of important personages, who were regarded by the Chinese as being just above the rank of vagabonds;—no more respectable, in their possession of incomes graduating from 4000l. to 18,000l. a-year, than the American free-traders who turn their backs on the Hong merchants, and go into the open market, offering their furs with one hand, and receiving teas and nankeens with the other, cleverly stealing the trade of the British meantime with both. What wealth and comfort untold might the two vast empires of Britain and China have poured into one another by this time, if their original jealousies had not been perpetuated by English mismanagement! The Dutch and the Americans have both smuggled large quantities of tea into England, while the twelve supercargoes at Canton have been talking politics or yawning within the walls of their Factory! Truly did the Celestial Emperor say to our representatives, “Your good fortune has been small! You arrived at the gates of the imperial house, and were unable to lift your eyes to the face of heaven.” The day of exclusion is, however, over. It may be long before we can overcome the contempt of the nation, and make them forget that some of our politicians were traders: but we have the interests of the Chinese in our favour. They will import according to their needs; more of our weavers and cutlers will have money to buy tea with, and they will get more tea for their money; and no one can tell what new classes of productions may become common when the messengers of these two mighty empires shall go to and fro, and knowledge shall be increased.
Such are a few of the specimens which might be adduced of the mischiefs wrought in one hemisphere by interference with commerce. “To all things there cometh an end;” to all unjust and foolish things, at least. We are now in possession of so ample a stock of experience, that the day cannot be far off when all customs duties shall be repealed but those which are necessary for the purposes of revenue. There will be some half-objectors left; some importers who will admit the impolicy of protections of all articles but the one in which they happen to deal. Mr. Huskisson was pathetically appealed to to protect green glass bottles; and a last struggle may be tried with another minister in favour of liquorice or coral beads; but an immense majority of every civilised people are verging towards a mutual agreement to give, in order that to each may be given “full measure, pressed down, and shaken together, and running over.” Such is the plenty in which God showers his gifts among us; and such is the measure in which he would have us yield each to the other.
The countries of the world differ in their facilities for producing the comforts and luxuries of life.
The inhabitants of the world agree in wanting or desiring all the comforts and luxuries which the world produces.
These wants and desires can be in no degree gratified but by means of mutual exchanges. They can be fully satisfied only by means of absolutely universal and free exchanges.
By universal and free exchange,—that is, by each person being permitted to exchange what he wants least for what he wants most,—an absolutely perfect system of economy of resources is established; the whole world being included in the arrangement.
The present want of agreement in the whole world to adopt this system does not invalidate its principle when applied to a single nation. It must ever be the interest of a nation to exchange what it wants little at home for what it wants more from abroad. If denied what it wants most, it will be wise to take what is next best; and so on, as long as anything is left which is produced better abroad than at home.
In the above case, the blame of the deprivation rests with the prohibiting power; but the suffering affects both the trading nations,—the one being prevented getting what it wants most,—the other being prevented parting with what it wants least.
As the general interest of each nation requires that there should be perfect liberty in the exchange of commodities, any restriction on such liberty, for the sake of benefiting any particular class or classes, is a sacrifice of a larger interest to a smaller,—that is a sin in government.
This sin is committed when,—
First,—Any protection is granted powerful enough to tempt to evasion, producing disloyalty, fraud, and jealousy: when,
Secondly,—Capital is unproductively consumed in the maintenance of an apparatus of restriction: when,
Thirdly,—Capital is unproductively bestowed in enabling those who produce at home dearer than foreigners to sell abroad as cheap as foreigners,—that is, in bounties on exportation: and when,
Fourthly,—Capital is diverted from its natural course to be employed in producing at home that which is expensive and inferior, instead of in preparing that which will purchase the same article cheap and superior abroad,—that is, when restrictions are imposed on importation.
But though the general interest is sacrificed, no particular interest is permanently benefited, by special protections: since
Restrictive regulations in favour of the few are violated, when such violation is the interest of the many; and
Every diminution of the consumer’s fund causes a loss of custom to the producer. Again,
The absence of competition and deprivation of custom combine to make his article inferior and dear; which inferiority and dearness cause his trade still further to decline.
Such are the evils which attend the protection of a class of producers who cannot compete with foreign producers of the same article.
If home producers can compete with foreign producers, they need no protection, as, cæteris paribus, buying at hand is preferable to buying at a distance.
Free competition cannot fail to benefit all parties:—
Consumers, by securing the greatest practicable improvement and cheapness of the article;
Producers, by the consequent perpetual extension of demand;—and
Society at large, by determining capital to its natural channels.
Colonies are advantageous to the mother-country as affording places of settlement for her emigrating members, and opening markets where her merchants will always have the preference over those of other countries, from identity of language and usages.
Colonies are not advantageous to the mother-country as the basis of a peculiar trade.
The term “colony trade” involves the idea of monopoly; since, in a free trade, a colony bears the same relation as any other party to the mother-country.
Such monopoly is disadvantageous to the mother-country, whether possessed by the government, as a trading party, by an exclusive company, or by all the merchants of the mother-country.
It is disadvantageous as impairing the resources of the dependency, which are a part of the resources of the empire, and the very material of the trade which is the object of desire.
If a colony is forbidden to buy of any but the mother-country, it must do without some articles which it desires, or pay dear for them;—it loses the opportunity of an advantageous exchange, or makes a disadvantageous one. Thus the resources of the colony are wasted.
If a colony is forbidden to sell its own produce to any but the mother-country, either the prohibition is not needed, or the colony receives less in exchange from the mother-country than it might obtain elsewhere. Thus, again, the resources of the colony are wasted.
If a colony is forbidden either to buy of or sell to any but the mother-country, the resources of the colony are wasted according to both the above methods, and the colony is condemned to remain a poor customer and an expensive dependency.
In proportion, therefore, as trade with colonies is distinguished from trade with other places, by restrictions on buyers at home, or on sellers in the colonies, that trade (involving the apparatus of restriction) becomes an occasion of loss instead of gain to the empire.
If restrictive interference be impolitic,—oppressive,—impious, between empire and empire, it becomes absolutely monstrous when introduced among the different classes of the same country. The magistrates of a grazing county would do ill to prohibit intercourse with the manufacturing, and agricultural, and mining districts around; but much more oppressive and fatal would be the policy of a city corporation which should make the resources of the city depend on the will of the corn-dealers which it contained.—Such has been the policy of the rulers of Britain; and side by side with this restriction of the supply of food,—this abuse of capital,—may be placed the curious perversion of labour which is caused not only by the forcing of agriculture at the expense of manufactures, but by the existence of exclusive and injurious privileges to trading corporations, of certain ancient laws respecting apprenticeship, and of the iniquitous practice of the impressment of seamen.
The system of restricting the supply of food would exhibit as many sins under the head of Production as of Distribution. To make an ever-increasing population depend on graduating soils for its support, is at once to enact that either a certain number shall die outright of hunger, or that a much larger number shall be half-fed; and that, in either, case, waste of capital must be made in proportion to the inferiority of our newly-cultivated soils compared with those which might yield us their produce from abroad. From this waste arises another and equally destructive species of waste in the preparation of our manufactured articles. Wages are higher than they need be to purchase the same necessaries; therefore our manufactured articles are higher priced than they need be; therefore they have not a fair chance in foreign markets; and therefore our ill-fed manufacturing population is wronged. Such are some of the evils of a restricted trade in corn, considered under the head of Production. As for the distribution of this prime necessary of life,—the circumstance of its being loaded with an artificial cost suggests the deplorable scenes and narratives of suffering which may be verified in every street of all our cities. No arrangement can be more utterly unprincipled than that by which a necessary of life, of which the richest can scarcely consume more than the poorest, is made needlessly expensive. We may linger in vain to find a comparison to illustrate the iniquity. It is the worst possible instance of legislative injustice; and when it is considered that this injustice is perpetrated for the benefit of a particular class, which class is brought by it to the verge of ruin, and that the injury spreads to every other class in turn, it will be seen that no words can describe its folly. Add to this our provisions for diverting labour from its natural channels, and for making it stagnate in one spot, and it will appear as if we had yet to learn the rights of labour and the uses of capital, or as if we openly defied the one, and abused the other. It is not so, however. The folly came before the iniquity; and, in cases of false legislation, the folly, originating in ignorance, must be long perceived and pointed out,—i.e. must become iniquity,—before it can be remedied. But the remedy is secured from the moment that the denunciation goes abroad. We have passed through the necessary stages, and the issue is at hand. Our grandfathers legislated about corn on false principles, through ignorance; our fathers clung to these false principles in a less innocent state of doubt. We have perpetuated them wickedly, knowing their disastrous results; and a voice is going up through all the land which will almost immediately compel their relinquishment.
Very little can be done to improve the condition of the people till the Corn Laws are repealed. All practicable retrenchments, all ordinary reduction of taxation, all reforms in the organization of Church and State, important as they are, are trifles compared with this. The only measure of equal consequence is the reduction of the Debt; and this ought to accompany or immediately precede the establishment of a free trade in corn. Day and night, from week to week, from month to month, the nation should petition for a free trade in corn, urging how landlords, when freed from fluctuation of their revenues, will be able to bear their fair proportion of the national burdens; how the farmer, no longer tempted to a wasteful application of capital, will cease the so-called ungrateful clamour with which he repays legislative protection; how the manufacturing class will prosper and will multiply our resources when they are allowed the benefits of the free competition in which their ingenuity qualifies them to hold a distinguished place; and how our labourers will be, by one comprehensive act, raised, every man of them, a grade higher than any laborious, partial legislation can raise any one of their classes. An act which must, at once, prevent the waste of capital and the misapplication of labour, unclog the system of manufactures and commerce, and obviate the main distresses of our agriculturists, must do more for the improvement of our revenue, and the union of our nation than all less comprehensive measures put together. To untax the prime necessary of life is to provide at once a prospective remedy for all the worst evils of our social arrangements. This will scarcely be disputed by those who admit the principles of the following summary. It is important that such results of these principles should be traced out and made familiar to the mind, as it is certain that the days of free trading in corn are at hand.
As exchangeable value is ultimately determined by the cost of production, and as there is an incessant tendency to an increase in the cost of producing food, (inferior soils being taken into cultivation as population increases,) there is a perpetual tendency in the exchangeable value of food to rise, however this tendency may be temporarily checked by accidents of seasons, and by improvements in agricultural arts.
As wages rise (without advantage to the labourer) in consequence of a rise in the value of food, capitalists must either sell their productions dearer than is necessary where food is cheaper, or submit to a diminution of their profits.
Under the first alternative, the capitalist is incapacitated for competition with the capitalists of countries where food is cheaper: under the second, the capital of the country tends, through perpetual diminution, to extinction.
Such is the case of a thickly-peopled country depending for food wholly on its own resources.
There are many countries in the world where these tendencies have not yet shown themselves; where there is so much fertile land, that the cost of producing food does not yet increase; and where corn superabounds, or would do so, if there was inducement to grow it.
Such inducement exists in the liberty to exchange the corn with which a thinly-peopled country may abound, for the productions in which it is deficient, and with which a populous country may abound. While, by this exchange, the first country obtains more corn in return for its other productions, and the second more of other productions in return for its corn, than could be extracted at home, both are benefited. The capital of the thickly-peopled country will perpetually grow; the thinly-peopled country will become populous; and the only necessary limit of the prosperity of all will be the limit to the fertility of the world.
But the waste of capital caused by raising corn dear and in limited quantities at home, when it might be purchased cheap and in unlimited quantities abroad, is not the only evil attending a restriction of any country to its own resources of food; a further waste of capital and infliction of hardship are occasioned by other consequences of such restriction.
As the demand for bread varies little within any one season, or few seasons, while the supply is perpetually varying, the exchangeable value of corn fluctuates more than that of any article whose return to the cost of production is more calculable.
Its necessity to existence causes a panic to arise on the smallest deficiency of supply, enhancing its price in undue proportion; and as the demand cannot materially increase on the immediate occasion of a surplus, and as corn is a perishable article, the price falls in an undue proportion.
These excessive fluctuations, alternately wasting the resources of the consumers and the producers of corn, are avoided where there is liberty to the one class to buy abroad in deficient seasons, and to the other to sell abroad in times of superabundance.
It is not enough that such purchase and sale are permitted by special legislation when occasion arises, as there can be no certainty of obtaining a sufficient supply, on reasonable terms, in answer to a capricious and urgent demand.
Permanently importing countries are thus more regularly and cheaply supplied than those which occasionally import and occasionally export; but these last are, if their corn-exchanges be left free, immeasurably more prosperous than one which is placed at the mercy of man and circumstance by a system of alternate restriction and freedom.
By a regular importation of corn, the proper check is provided against capital being wasted on inferior soils; and this capital is directed towards manufactures, which bring in a larger return of food from abroad than could have been yielded by those inferior soils. Labour is at the same time directed into the most profitable channels. Any degree of restriction on this natural direction of labour and capital is ultimately injurious to every class of the community,—to land-owners, farming and manufacturing capitalists, and labourers.
Labourers suffer by whatever makes the prime necessary of life dear and uncertain in its supply, and by whatever impairs the resources of their employers.
Manufacturing capitalists suffer by whatever tends needlessly to check the reciprocal growth of capital and population, to raise wages, and disable them for competition abroad.
Farming capitalists suffer by whatever exposes their fortunes to unnecessary vicissitude, and tempts them to an application of capital which can be rendered profitable only by the maintenance of a system which injures their customers.
Landowners suffer by whatever renders their revenues fluctuating, and impairs the prosperity of their tenants, and of the society at large on which the security of their property depends.
As it is the interest of all classes that the supply of food should be regular and cheap, and as regularity and cheapness are best secured by a free trade in corn, it is the interest of all classes that there should be a free trade in corn.
The duty of government being to render secure the property of its subjects, and their industry being their most undeniable property, all interference of government with the direction and the rewards of industry is a violation of its duty towards its subjects.
Such interference takes place when some are countenanced by legislation in engrossing labours and rewards which would otherwise be open to all; as in the case of privileged trading corporations;—
When arbitrary means of preparation are dictated as a condition of the exercise of industry, and the enjoyment of its fruits,—as in the case of the apprenticeship law;—
When labourers are compelled to a species of labour which they would not have chosen,—as in the case of the impressment of seamen.
The same duty—of securing the free exercise of industry—requires that companies should be privileged to carry on works of public utility which are not within the reach of individual enterprise,—as in the case of roads, canals, bridges, &c.; and also,
That the fruits of rare ingenuity and enterprise should be secured to the individual,—according to the design of our patent law.
In the first-mentioned instances of interference, the three great evils arise of
The restraint of fair competition in some cases;
The arbitrary increase of competition in other cases;
The obstruction of the circulation of labour and capital from employment to employment, and from place to place.
In the last-mentioned instances of protection, none of these evils take place.
The general principles of Exchange are so few and obvious that there would be little need to enlarge upon them but for their perpetual violation. To leave all men free to seek the gratification of their wants seems a simple rule enough; and universal experience has shown, not only that wants freely expressed are sure to be supplied, generally to the advantage of both parties, but that every interference of authority, whether to check or stimulate the want,—to encourage or discourage the supply, proves an aggression on the rights of industry, and an eventual injury to all concerned. All that governments have to do with the exchanges of nations, as of individuals, is to protect their natural freedom; and, if a system of indirect taxation be the one adopted, to select those commodities for duty which are not necessary enough to subject the lowest class to this species of tax, while they are desirable enough to induce others to pay the additional cost. It may be a question whether this method of raising revenue be wise: there can be no question that a government directly violates its duty when it grants privileges (real or supposed) to one class above another.
But, it is said, governments have always shown more or less of this partiality. May it be confidently anticipated that they will ever cease to transgress the legitimate bounds of their power?
Yes; very confidently. Such transgression is a feudal barbarism. The feudal system has died out in theory; and it is impossible that its practical barbarism should long remain. The progress of freedom has been continuous and accountable, and its consummation is clearly a matter of confident prophecy. Sovereigns, grand and pretty, individual or consisting of a small number compacted into a government, have first exercised absolute power over the lives, properties and liberties of their subjects: this despotic grasp has been gradually relaxed, till life, property, and liberty have been made to depend on law, and not on arbitrary will. Next, the law has been improved, from being the agent of such arbitrary will, to being the expression of a more extended and abstract will. From this stage of improvement the progress has been regular. The province of rule has been narrowed, and that of law has been enlarged. Whatever may have been,—whatever may still be,—the faults in the methods of making the law, the absurdities of the law in some of its parts, and its inadequateness as a whole in every civilized country, the process of enlargement has still gone on, some unjust usurpation being abolished, some sore oppression removed from time to time, affording a clear prospect of a period when every natural and social right shall be released from the gripe of irresponsible authority. No king now strikes off heads at any moment when the fancy may seize him. No kings’ councillors now plunder their neighbours to carry on their wars or their sports, or are paid for their services by gifts of patents and monopolies. No parliaments now make laws according to the royal pleasure, without consulting the people; and, if they are slow to repeal some oppressive old laws with which the people are disgusted, it is certain that such laws could not at this day be proposed. What can be more eloquent than this language of events? What more prophetic than this progression? While the agents by which the advance has been achieved are multiplied and strengthened,—while its final purposes are more clearly revealed, day by day, what other expectation can be entertained than that it will advance more and more rapidly, till the meanest rights of industry shall be at length freed from the last aggressions of power? Then the humblest labourer may buy his loaf and sell his labour in what corner of the earth he pleases. Then legislators will no more dream of dictating what wine shall be drunk, and what fabrics shall be worn, and through what medium God’s free gifts must be sought, than they now dream of branding a man’s face on account of his theology. They will perceive that the office of dispensing the bounty of nature is not theirs but God’s; and that the agents he has appointed are neither kings, parliaments, nor custom-house officers, but those ever-growing desires with which he has vivified the souls of the haughtiest and the lowliest of his children.
PART IV.
Consumption is of two kinds—productive and unproductive.
The object of the one is the restoration, with increase, in some new form, of that which is consumed. The object of the other is the enjoyment of some good through the sacrifice of that which is consumed.
That which is consumed productively is capital, re-appearing for future use. That which is consumed unproductively ceases to be capital, or any thing else: it is wholly lost.
Such loss is desirable, or the contrary, in proportion as the happiness resulting from the sacrifice exceeds or falls short of the happiness belonging to the continued possession of the consumable commodity.
The total of what is produced is called the gross produce.
That which remains, after replacing the capital consumed, is called the net produce.
While a man produces only that which he himself consumes, there is no demand and supply.
If a man produces more of one thing than he consumes, it is for the sake of obtaining something which another man produces, over and above what he consumes.
Each brings the two requisites of a demand,—viz., the wish for a supply, and a commodity wherewith to obtain it.
This commodity, which is the instrument of demand, is, at the same time, the instrument of supply.
Though the respective commodities of no two producers may be exactly suitable to their respective wishes, or equivalent in amount, yet, as every man’s instrument of demand and supply is identical, the aggregate demand of society must be precisely equal to its supply.
In other words, a general glut is impossible.
A partial glut is an evil which induces its own remedy; and the more quickly the greater the evil; since, the aggregate demand and supply being always equal, a superabundance of one commodity testifies to the deficiency of another; and, all exchangers being anxious to exchange the deficient article for that which is superabundant, the production of the former will be quickened, and that of the latter slackened.
A new creation of capital, employed in the production of the deficient commodity, may thus remedy a glut.
A new creation of capital is always a benefit to society, by constituting a new demand.
It follows that an unproductive consumption of capital is an injury to society, by contracting the demand. In other words, an expenditure which avoidably exceeds the revenue is a social crime.
All interference which perplexes the calculations of producers, and thus causes the danger of a glut, is also a social crime.
It is necessary to the security and advancement of a community that there should be an expenditure of a portion of its wealth for purposes of defence, of public order, and of social improvement.
As public expenditure, though necessary, is unproductive, it must be limited; and as the means of such expenditure are furnished by the people for defined objects, its limit is easily ascertained.
That expenditure alone which is necessary to defence, public order, and social improvement, is justifiable.
Such a direction of the public expenditure can be secured only by the public functionaries who expend being made fully responsible to the party in whose behalf they expend.
For want of this responsibility, the public expenditure of an early age—determined to pageantry, war, and favouritism—was excessive, and perpetrated by the few in defiance of the many.
For want of a due degree of this responsibility, the public expenditure of an after age—determined to luxury, war, and patronage—was excessive, and perpetrated by the few in fear of the many, by deceiving and defrauding them.
For want of a due degree of this responsibility, the public expenditure of the present age—determined chiefly to the sustaining of burdens imposed by a preceding age—perpetuates many abuses; and though much ameliorated by the less unequal distribution of power, the public expenditure is yet as far from being regulated to the greatest advantage of the many, as the many are from exacting due responsibility and service from the few.
When this service and responsibility shall be duly exacted, there will be—
Necessary offices only, whose duties will be clearly defined, fully accounted for, and liberally rewarded;—
Little patronage, and that little at the disposal of the people;—
No pomp, at the expense of those who can barely obtain support;—but
Liberal provisions for the advancement of national industry and intelligence.
If the above principles be true, a comparison of them with our experience will yield very animating conclusions. Consumption—that is, human enjoyment—is the end to which all the foregoing processes are directed. Demand is the index of human enjoyment. Every increase of capital creates a new demand. Capital is perpetually on the increase. To sum up the whole, human enjoyment is perpetually on the increase. The single exception to this happy conclusion is where, as in Ireland, the growth of capital is overmatched by the increase of population. But even in Ireland (the worst case which could be selected) the evil is so partial as to allow the good to spread. Though too large a portion of the demand comes in the form of a clamour for daily food, there is a new and spreading demand for a multitude of articles of less necessity. Portions of the population are rising to a region of higher and wider desires; and if this partial elevation has taken place under a most vicious political system, there need be no question that a more rapid improvement will grow up under that wiser and milder government which the civilized world will take care that Ireland shall at length enjoy. There is something so delightful in the review of the multiplication of comforts and enjoyments, that it is difficult to turn away from it at any time; and never is it more difficult than when establishing the moral of hopefulness. But I have dwelt largely on this happy truth in my story of “Briery Creek;” and probably no day passes in which my readers do not hear or say something about the wonderful improvements in art, the variety of new conveniences, and the spread downwards of luxuries to which the wealthy were formerly believed to have an exclusive title. Great as is still the number of those who are scorched by God’s vivifying sun, and chilled by his fertilizing rain, for want of shelter and clothing, the extension of enjoyment has kept its proportion (being both cause and effect) to the improvement of the subordinate processes. With every increase of production, with every improvement of distribution, with every extension of exchange, consumption has kept pace. The only checks it has ever received have arisen out of those legislative sins which have wrought, or must work, their own destruction.
As for that species of consumption which has been always regarded with the least complacency,—the too long unprofitable consumption of government,—nothing can be more cheering than to mark the changes in its character from an early period of our empire till now. Viewed by itself, our government expenditure is a mournful spectacle enough; but the heaviest of the burdens we now bear were imposed by a former age; and our experience of their weight is a sufficient security against such being ever imposed again. We are no longer plundered by force or fraud, and denied the redress of a parliament; we are no longer hurried into wars, and seduced to tax our children’s children for their support. The sin is now that of omission, and not of perpetration. We do not shake off old burdens, or provide for public order and social improvement as we should; but we do not neglect the one and despise the other, as was done in days of old; and what is left undone there is a spreading movement to effect. The only irreclaimable human decree,—that of an enlightened multitude,—has gone forth against the abuses of the Church and the Law. The Army will follow; and there is reason to hope that a force is being already nourished which may grapple with the gigantic Debt itself. New and noble institutions are being demanded from all quarters as the natural growth from the renovation of the old ones. Religion must yield Education, and Law a righteous Penal Discipline. Schools must spring up around our churches, and prisons will be granted where the law must, if possible, mend criminals as effectually as it has hitherto made them. In time, we shall find that we have spare barracks, which may be converted into abodes of science; and many a parade may become an exercising place for laborious mechanics instead of spruce soldiers. Such are some of the modes of public expenditure which the nation is impatient to sanction. What further institutions will be made to grow out of these, we may hereafter learn in the schools which will presently be planted wherever families are congregated. All that we can yet presume is, that they will be as much wiser than ours as our extravagances are more innocent than the savage pageantries of the Henries, the cruel pleasantries of the Charleses, and the atrocious policy of the “heaven-born Ministers” who figure in our history.
All the members of a society who derive protection from its government owe a certain proportion of the produce of their labour or capital to the support of that government—that is, are justly liable to be taxed.
The proportion contributed should be determined by the degree of protection enjoyed—of protection to property; for all are personally protected.
In other words, a just taxation must leave all the members of society in precisely the same relation in which it found them.
This equality of contribution is the first principle of a just taxation.
Such equality can be secured only by a method of direct taxation.
Taxes on commodities are, from their very nature, unequal, as they leave it in the choice of the rich man how much he shall contribute to the support of the state; while the man whose whole income must be spent in the purchase of commodities has no such choice. This inequality is aggravated by the necessity, in order to make these taxes productive, of imposing them on necessaries more than on luxuries.
Taxes on commodities are further injurious by entailing great expense for the prevention of smuggling, and a needless cost of collection.
They could not have been long tolerated, but for their quality of affording a convenient method of tax paying, and for the ignorance of the bulk of the people of their injurious operation.
The method of direct taxation which best secures equality is the imposition of a tax on income or on property.
There is so much difficulty in ascertaining, to the general satisfaction, the relative values of incomes held on different tenures, and the necessary inquisition is so odious, that if a tax on the source of incomes can be proved equally equitable, it is preferable, inasmuch as it narrows the province of inquisition.
There is no reason to suppose that an equitable graduation of a tax on invested capital is impracticable; and as it would equally affect all incomes derived from this investment,—that is, all incomes whatsoever,—its operation must be singularly impartial, if the true principle of graduation be once attained.
A graduated property-tax is free from all the evils belonging to taxes on commodities; while it has not their single recommendation—of favouring the subordinate convenience of the tax-payer.
This last consideration will, however, become of less importance in proportion as the great body of tax-payers advances towards that enlightened agreement which is essential to the establishment of a just system of taxation.
The grossest violation of every just principle of taxation is the practice of burdening posterity by contracting permanent loans, of which the nation is to pay the interest.
The next grossest violation of justice is the transmitting such an inherited debt unlessened to posterity, especially as every improvement in the arts of life furnishes the means of throwing off a portion of the national burdens.
The same rule of morals which requires state-economy on behalf of the present generation, requires, on behalf of future generations, that no effort should be spared to liquidate the National Debt.
No sign of the times is more alarming,—more excusably alarming,—to the dreaders of change, than the prevailing unwillingness to pay taxes,—except such as, being indirect, are paid unawares. The strongest case which the lovers of old ways have now to bring in opposition to the reforming spirit which is abroad, is that of numbers, who enjoy protection of life and property, being reluctant to pay for such protection.
This reluctance is a bad symptom. It tells ill for some of our social arrangements, and offers an impediment, at the same time, to their rectification; and thus gives as much concern to the reformers as to the preservers of abuses. This eagerness to throw off the burdens of the state is a perfectly natural result of the burdens of the state having been made too heavy; but it does not the less exhibit an ignorance of social duty which stands formidably in the way of improvements in the arrangement of social liabilities. We are too heavily taxed, and the first object is to reduce our taxation. Indirect taxes are proved to be by far the heaviest, and the way to gain our object is therefore to exchange indirect for direct taxes, to the greatest possible extent. But the direct taxes are those that the people quarrel with. What encouragement is there for a government to propose a commutation of all taxes for one on property, when there is difficulty in getting the assessed taxes paid? How is it to be supposed that men will agree to that on a larger scale which they quarrel with on a smaller? How can there be a stronger temptation offered to our rulers to filch the payment out of our raw materials, our tea, our beer, our newspapers, and the articles of our clothing? The more difficulty there is in raising the supplies, the more risk we run of being made to yield of our substance in ways that we are unconscious of, and cannot check. The less manliness and reasonableness we show in being ready to bear our just burden, the less chance we have of the burden being lightened to the utmost. It is more than mortifying to perceive that an overburdened nation must, even if it had a ministry of sages, submit for a long time to pay an enormous tax upon its own ignorance.
Such appears too plainly to be now the case with our nation, and with some other nations. A party of gentlemen may be found in any town, sitting over their wine and foreign fruits, repelling the idea of paying a yearly sum to the state, and laughing, or staring, when the wisest man among them informs them that they pay above 100 per cent. on the collective commodities they use. Tradesmen may be found in every village who think it very grievous to pay a house-tax, while they overlook the price they have to give for their pipe of tobacco and their glass of spirit and water. Some noblemen, perhaps, would rather have higher tailors’ bills for liveries than pay so much a head for their servants. As long as this is the case,—as long as we show that we prefer paying thirty shillings with our eyes shut to a guinea with our eyes open, how can we expect that there will not be hands ready to pocket the difference on the way to the Treasury; and much disposition there to humour us in our blindness?
The cry for retrenchment is a righteous cry; but all power of retrenchment does not lie with the Government. The Government may do much; but the people can do more, by getting themselves taxed in the most economical, instead of the most wasteful, manner. It is a good thing to abolish a sinecure, and to cut down the salary of a bishop or a general; but it is an immeasurably greater to get a direct tax substituted for one on cider or paper. All opposition to the principle of a direct tax is an encouragement to the appointment of a host of excisemen and other tax-gatherers, who may, in a very short time, surpass a bench of bishops and a long gradation of military officers in expensiveness to the people. It is time for the people to take care that the greater retrenchments are not hindered through their mistakes, while they are putting their whole souls into the demand for the lesser.
Such mistakes are attributable to the absence of political knowledge among us; and the consequences should be charged, not to individuals, but to the State, which has omitted to provide them with such knowledge. The bulk of the people has yet to learn that, being born into a civilized society, they are not to live by chance, under laws that have been made they know not why nor how, to have a portion of their money taken from them by people they have nothing to do with, so that they shall be wise to save as much as they can from being so taken from them. This is the view which too large a portion of us take of our social position, instead of understanding that this complicated machine of society has been elaborated, and must be maintained, at a great expense; that its laws were constructed with much pains and cost; that under these laws capital and labour are protected and made productive, and every blessing of life enhanced; and that it is therefore a pressing obligation upon every member of society to contribute his share towards maintaining the condition of society to which he owes his security and social enjoyment. When this is understood,—when the lowest of our labourers perceives that he is, as it were, the member of a large club, united for mutual good,—none but rogues will think of shirking the payment of their subscription-money, or resist any particular mode of payment before the objections to it have been brought under the consideration of the Committee, or after the Committee has pronounced the mode to be a good one. They will watch over the administration of the funds; but they will manfully come forward with their due contributions, and resent, as an insult upon their good sense, all attempts to get these contributions from them by indirect means.
Till they are enabled thus to view their own position, it is not wonderful, however deplorable, that they should quarrel with a just tax because it is unequally imposed, ascribing to the principle the faults committed in its application. This is the less surprising too, because their teeth have been set on edge by the sour grapes with which their fathers were surfeited. A lavish expenditure and accumulating debt have rendered odious the name and notion of every tax under heaven. Great allowance must be made for the effects of such ignorance and such irritation. Let the time be hastened when a people, enlightened to its lowest rank, may behold its meanest members heard with deference instead of treated with allowance, if they shall see reason for remonstrance in regard to their contributions to the state! When they once know what is the waste in the department of the Customs, and the oppression and fraud in that of the Excise,—what are the effects of taxes on raw produce, and on the transfer of property, and how multiplied beyond all decency are the burdens of local taxation, they will value every approach towards a plan of direct levy, and will wonder at their own clamour about the house and window taxes, (except as to their inequality of imposition,) while so many worse remained unnoticed. I shall attempt to exhibit the effects on industry and happiness of our different kinds of taxes in a few more tales; and I only wish I had the power to render my picture of a country of untaxed commodities as attractive in fiction as I am sure it would be in reality. Meantime, I trust preparation will be making in other quarters for imparting to the people those political principles which they desire to have for guides in these stirring times, when every man must act: those principles which will stimulate them at once to keep watch over the responsibilities of their rulers, and to discharge their own.
What, then, is the moral of my fables? That we must mend our ways and be hopeful;—or, be hopeful and mend our ways. Each of these comes of the other, and each is pointed out by past experience to be our duty, as it ought to be our pleasure. Enough has been said to prove that we must mend our ways: but I feel as if enough could never be said in the enforcement of hopefulness. When we see what an advance the race has already made, in the present infant stage of humanity,—when we observe the differences between men now living,—it seems absolute impiety to doubt man’s perpetual progression, and to question the means. The savage who creeps into a hollow tree when the wind blows keen, satisfying his hunger with grubs from the herbage, and the philosopher who lives surrounded by luxury which he values as intellectual food, and as an apparatus for securing him leisure to take account of the stars, and to fathom the uses of creation, now exist before our eyes,—the one a finished image of primeval man; the other a faint, shadowy outline of what man may be.—Why are these men so unlike? By observing every gradation which is interposed, an answer may be obtained.—They are mainly formed by the social circumstances amidst which they live. All other differences,—of bodily colour and form, and of climate,—are as nothing in comparison. Wherever there is little social circumstance, man remains a savage, whether he be dwarfed among the snows of the Pole, or stretches his naked limbs on the hot sands of the desert, or vegetates in a cell like Caspar Hauser. Where-ever there is much social circumstance, man becomes active, whether his activity be for good or for evil. In proportion as society is so far naturally arranged as that its relations become multitudinous, man becomes intellectual, and in certain situations and in various degrees, virtuous and happy. Is there not yet at least one other stage, when society shall be wisely arranged, so that all may become intellectual, virtuous, and happy; or, at least, so that the exceptions shall be the precise reverse of those which are the rare instances now? The belief is irresistible.
There has been but one Socrates, some say; and he lived very long ago.—Who knows that there has been but one Socrates? Which of us can tell but that one of our forefathers, or some of ourselves, may have elbowed a second or a tenth Socrates in the street, or passed him in the church aisle? His philosophy may have lain silent within him. Servitude may have chained his tongue; hunger may have enfeebled his voice; he may have been shut up in the Canton Factory, or crushed under a distraint for poor-rates or tithes. Till it has been known how many noble intellects have been thus chained and silenced, let no one venture to say that there has been but one Socrates.
Supposing, however, that there has been but one, does it follow that the world has gone back, or has not got forward since his day? To judge of the effect of social institutions on character and happiness, we must contemplate a nation, and not the individual the most distinguished of that nation. What English artisan would change places with the Athenian mechanic of the days of Socrates, in respect of external accommodation? What English artisan has not better things to say on the rights of industry, the duties of governments, and the true principle of social morals, than the wisest orator among the Greek mechanics in the freest of their assemblies? It is true that certain of our most refined and virtuous philosophers are engaged nearly all day in servile labour, and that they wear patched clothes, and would fain possess another blanket. This proves that our state of society is yet imperfect; but it does not prove that we have not made a prodigious advance. Their social qualifications, their particular services, have not been allowed due liberty, or received their due reward; but the very circumstance of such men being found among us, banded together in the pursuit of good, is a sufficient test of progress, and earnest of further advancement. Such men are not only wiser, and more prosperous in their wisdom, than they were likely to have been while building a house for Socrates, or making sandals for Xantippe, but they have made a vast approach towards being employed according to their capacities, and rewarded according to their works,—that is, towards participating in the most perfect conceivable condition of society.
When, till lately, has this condition of society been distinctly conceived of,—not as an abstract good, to be more imagined than expected,—but as a natural, inevitable consequence of labour and capital, and their joint products, being left free, and the most enlightened intellect having, in consequence, an open passage left accessible, by which it might rise to an influential rank? Such a conception as this differs from the ancient dreams of benevolent philosophers, as the astronomer’s predictions of the present day differ from the ancient mythological fables about the stars. The means of discernment are ascertained—are held in our hands. We do not presume to calculate the day and hour when any specified amelioration shall take place; but the event can be intercepted only by such a convulsion as shall make heaven a wreck and earth a chaos. In no presumption of human wisdom is this declaration pronounced. Truth has one appropriate organ, and principles are that organ; and every principle on which society has advanced makes the same proclamation. Each has delivered man over to a nobler successor, with a promise of progression, and the promise has never yet been broken. The last and best principle which has been professed, if not acted upon, by our rulers, because insisted on by our nation, is “the greatest happiness of the greatest number.” Was there ever a time before when a principle so expanding and so enduring as this was professed by rulers, because insisted on by the ruled? While this fact is before our eyes, and this profession making music to our ears, we can have no fears of society standing still, though there be brute tyranny in Russia, and barbarian folly in China, and the worst form of slavery at New Orleans, and a tremendous pauper population at the doors of our own homes. The genius of society has before transmigrated through forms as horrid and disgusting as these. The prophecy which each has been made to give out has been fulfilled: therefore shall the heaven-born spirit be trusted while revealing and announcing at once the means and the end—THE EMPLOYMENT OF ALL POWERS AND ALL MATERIALS, THE NATURAL RECOMPENSE OF ALL ACTION, AND THE CONSEQUENT ACCOMPLISHMENT OF THE HAPPINESS OF THE GREATEST NUMBER, IF NOT OF ALL.