sustained by a few individuals from a change of fashion, has been supposed to be more than compensated by the profits which others derive from it; and so prevalent has this opinion become, that in most of the European Courts it is considered as an act of policy for the encouragement of the manufacturers, that the fashions should be frequently altered. Yet nothing can be more certain than that such changes have a direct tendency to counteract the benefits derived to a country from great capital and extended subdivision of labor, and to bring it more on a footing with those of inferior capital and industry than it otherwise would be. Perma¬ nency in the laws, customs, duties, and fashions, is the very life and soul of industry, while frequent change is beneficial only to speculators in trade, as industry uniformly seeks the most certain, though small, gains; while speculation, contemning moderation, plunges headlong into the sea of chance; where, if unsuccessful, a part, and perhaps a considerable part, of the funds previously employed in supporting industry, is dissipated; and if successful, they are usually transferred from the maintenance of productive, to that of unproductive labor. The result of speculation in trade is, therefore, very seldom beneficial to the community at large, though it is frequently extremely convenient to a profuse and improvident government, to which the successful speculator is commonly willing to lend the principal part of his rapidly acquired fortune, and to pass the remainder of his life in the indolent luxury which its interest affords.

CHAP. VIII.-On the Means of restoring Prosperity to Great

Britain.

IN the previous chapters I have attempted to explain some of the causes which have given rise to the present calamitous state of Great Britain; to have enumerated the whole of them would have far exceeded the limits to which I had previously restricted myself. I shall now point out those measures, by the adoption of which, I conceive the prosperity of the country may be restored; previous to which it may not be improper to examine, as briefly as possible, some of the most popular notions on the origin of this unprecedented distress.

1st. Transition from a state of war to that of peace must unquestionably give rise to a very great change in the circumstances, the prospects, and the occupations of a great number of people, in any commercial country; and as the nature and extent of that change with regard to each individual, could neither be speedily nor accurately known to the public, so the consequent uncertainty in this respect necessarily gave rise to an unusual caution in all paper transactions; and as almost the whole of the circulating medium consisted of paper, so this transition must, in the late instance,

have been attended by inconveniences more than usually great: yet this could only have extended to public inconvenience, and even that of a very limited duration, As the aggregate capital of the country was in no respect diminished by the peace, a short time must have sufficed to show in whose hands it was placed; and as soon as that was discovered, all inconveniency arising merely from such transition, must have vanished. The reverse of this, however, has, in the present instance, taken place; the general distress com menced before the war ended, and it has gone on gradually increasing since that period, till a large proportion of the capital lately destined to the employment of industry, has been unavoidably appropriated to present consumption. The malady, far from having yet shown any symptom of mitigation, becomes daily aggravated, and now threatens the body politic with a most rapid decline.

In the transition from war to peace some check is necessarily given to agriculture, on account of the large stores for the use of the army and navy which are then generally sold off, and which seldom fail to reduce the price of agricultural produce. This, however, is but a temporary check, and can seldom last above a single year.

The transition from a state of war to that of peace must generally and immediately benefit the manufactures, by opening to them a more extensive market than they before enjoyed; and this was expected to have been peculiarly the case on the late peace, on account of what was termed the Continental System having embarrassed our exportations in an unprecedented manner. But those whose expectations were most sanguine on this head, had not duly appreciated the forced exportation of our manufactures, in order to purchase supplies to our armies on the continent, and to pay our war subsidies to foreign princes. These were expenses which we could only provide for by means of the exportation of our manufactures, and for which no article of importation was received in return and as these forced exportations were wholly in addition to the ordinary exportation to be exchanged for such foreign commodities as were in effectual demand in Britain; so it seems highly probable that our internal demand for foreign commodities will not soon so greatly increase, in time of peace, as to compensate our expenditure in foreign countries during the war: for we must never lose sight of the fundamental maxim, that we never expect any thing but to pay debt, or to purchase that for which there is an effectual demand at home.

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2d. The prevailing distress has been attributed by some persons to the failure of the late crop; and no doubt this has considerably aggravated the distress of the poor, by enhancing the price of provisions but in the year 1812 the grain rose to a much higher

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price than at present, in 1817 set the distress of that period was not to be compared to that of the present, because there was then no difficulty it procuring work, and that work was highly paid for, whereas, at present, it is a matter of difficulty to procure employment at any ages; and when the poor cannot procure work, it is of little, cousequence to them whether provisions be dear or cheap. The failure of the crop of 1816, however, must have given employment to a number of manufacturers who would otherwise have been idle; because all the grain imported must have been paid for by manufactures, for, which otherwise there would have been no demand. The high price of grain has also probably induced many farmers to cultivate their lands more extensively than they otherwise would have done, and thus bas given more employment to the poor than they otherwise would have got, And,

3d. The most general opinion attributes the present distress of the country to the high money price of the produce of land, which, say they, necessarily enhances the wages of labor, and, thus renders all our manufactures so dear that they cannot obtain a sale in any market of which they enjoy not the monopoly. The fallacy of this argument, I trust the reader will find completely elucidated in the first three chapters,

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It appears, to me, therefore, that the great efficient cause of the present distress can only be found in the diminution of the circulating medium of the country, which has thrown so great a proportion of the produce of the land and labor of the state into the hands of the unproductive classes, that there no longer remains a sufficient quantity appropriated to the maintenance of industry, to enable the laborer to subsist himself and his family by the sweat of his brow. And if this view of the subject be correct, the remedy can only be found in such public ineasures as may diminish the proportion of the produce of the land and labor of the state which is at present appropriated to the consumption of the unproductive classes, and thereby to increase the recompense of, and the stimulus to productive labor. This may be effected in several different ways, all of which, however, will probably be found subject to objection, and some of them perhaps to insurmountable incouve

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1st. Heavy and indiscriminate ad valorem duties on the importation of all foreign commodities, except the precious metals, I have already attempted to show, would have the effect of lowering the value of money in the home market, and of thereby diminishing the real revenue of some of the unproductive classes, particularly of those who subsist on income arising from the interest of money, , whether lent to the public or to individuals. Such duties, however, when carried to the extent which could produce any essential effect, in Britain, would be liable to many great inconve

nience. They must necessarily give very great encouragement to smuggling, though perhaps not more than it enjoys at present. But the principal objection would be," that as many foreign articles en>ter in different proportions into our manufactures for exportation, Sit would be exceedingly difficult so to regulate the drawbacks on exportation of these manufactures, as to compensate, and no more than compensate, the duties paid on importation of the component parts. This objection, however, would be more specious than real'; because, as the money price of the articles of home produce, would bby these duties be raised in exact proportion to that of those imported from abroad, so they would both regain their natural level with regard to each other, which hitherto has been very much deranged by the partiality of our duties; and it therefore appears that no drawbacks could be at all necessary, unless to encourage some manufacture which might be peculiarly conducive to the defence of the country, although not naturally adapted to it.

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As our duties have heretofore been regulated, so as to give undue encouragement to manufactures above agricultural industry, the restoring them to their natural level could not fail greatly to ang ment the rent of land, and thereby to enable it to bear a heavy tax, without altering the situation of the proprietors in society: and as they either bought or inherited these lands when the then existing regulations had depressed their natural value, so if their real value were augmented by a new system of fiscal government, the state, and not the proprietors of land, would be fairly intitled to the benefit of such improvement.

2d. A heavy tax on the rent of land and houses, and on the interest of money, whether lent to individuals or to the public, could not fail to be beneficial, as it would greatly affect the unpro ductive classes, by whom it must almost exclusively be paid. One bad effect, indeed, attending such a tax would be, that it might induce some persons to withdraw their capitals from Britain, in order to lend them in other countries; but the inconveniences attending the investment of capital in a foreign country are so great, that hardly any difference of interest will induce the generality of mankind to encounter them. We have seen that in the florishing settlement of Bengal, while the legal and customary interest of money was twelve per cent. per annum, and where failures were almost unknown, still few British subjects, who were resident in the mother country, judged it prudent to lend their money there, but rather contented themselves with four, four and a half, or at most five per cent: interest, where their property might be more immediately under their eye and management. It does not, therefore, appear that there would be any great hazard of much capital being removed on account of such a tax'; and as it has been avowedly in support of the security of property that most of Pam. VOL. XI. 2 F

NO. XXII.

the public debt has been incurred, who are so able, or can so properly be taxed for its payment, as the proprietors of land, houses, or other wealth?

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93d. As almost all the appendages of magnificence are not only unproductive to the state, but most of them equally injurious to the prosperity and morality of the people, it is probable that the assessed taxes might still be beneficially augmented, in commutation of those on leather, soap, candles, and salt; which are at present principally paid by the laboring poor; and are therefore very injurious, whether ultimately borne by this class or not: because, if ultimately borne by the laborer, they must prove a great discouragement to industry, and a great impediment to the increase of population; and if the laborer can shift the burthen of them from himself to his employer, they must necessarily takes much more out of the pocket of the subject, in proportion to what they yield to the state, than other taxes which are laid more directly on the parties by whom they are finally paid; for, as each person who advances the tax must have a profit on the stock which he employs in making such advance, so it follows, that the greater number of persons who in their turns are required to advance this tax, before it be finally paid by those who are to bear it, the more it must take out of the pocket of the subject in proportion to what it yields to the state. The assessed taxes can also be levied at a much less expense than the excise on these articles, and give no opportunity to smuggling, which the excise encourages in a very eminent degree.

The greatest objection against an increase of the assessed taxes is, that it might induce many persons to go abroad; but if there were taxes on the rent of land and houses, and on the interests of money, whether lent to the state or to individuals, these taxes might be so augmented on absentees, as amply to compensate any saving which they might make by evasion of the assessed taxesar

An objection has also been made to increasing the assessed taxes, on the plea that it would discourage the use of the articles, and thereby render them less productive. But it seems probable that no mode of taxation will greatly diminish the proportions of their revenue which people usually expend; and it is hardly possible to imagine any mode of spending money on personal enjoyment which may not be reached by assessed taxes. But the assessed taxes have generally been increased at periods when other taxes were also augmented; and it is quite clear that the more a person pays in taxes, the less he can enjoy. Every additional tax, of what nature soever, must have a tendency to diminish the produce of the assessed taxes. When the last augmentation of the assessed taxes took place, many persons laid down their carriages, and dismissed a part of their male servants, but it has never been alleged