markitect-main/examples/infospace-with-history/artifacts/sources/book-4-chapter-02.md

---
id: book-4-chapter-02
title: "OF RESTRAINTS UPON IMPORTATION FROM FOREIGN COUNTRIES OF SUCH GOODS AS CAN BE PRODUCED AT HOME."
book: "4"
chapter: 2
artifact_type: content
---

CHAPTER II.
OF RESTRAINTS UPON IMPORTATION FROM
FOREIGN COUNTRIES OF SUCH GOODS AS CAN BE PRODUCED AT HOME.



      By restraining, either by high duties, or by absolute prohibitions, the
      importation of such goods from foreign countries as can be produced at
      home, the monopoly of the home market is more or less secured to the
      domestic industry employed in producing them. Thus the prohibition of
      importing either live cattle or salt provisions from foreign countries,
      secures to the graziers of Great Britain the monopoly of the home market
      for butcher’s meat. The high duties upon the importation of corn, which,
      in times of moderate plenty, amount to a prohibition, give a like
      advantage to the growers of that commodity. The prohibition of the
      importation of foreign woollen is equally favourable to the woollen
      manufacturers. The silk manufacture, though altogether employed upon
      foreign materials, has lately obtained the same advantage. The linen
      manufacture has not yet obtained it, but is making great strides towards
      it. Many other sorts of manufactures have, in the same manner obtained in
      Great Britain, either altogether, or very nearly, a monopoly against their
      countrymen. The variety of goods, of which the importation into Great
      Britain is prohibited, either absolutely, or under certain circumstances,
      greatly exceeds what can easily be suspected by those who are not well
      acquainted with the laws of the customs.

      That this monopoly of the home market frequently gives great encouragement
      to that particular species of industry which enjoys it, and frequently
      turns towards that employment a greater share of both the labour and stock
      of the society than would otherwise have gone to it, cannot be doubted.
      But whether it tends either to increase the general industry of the
      society, or to give it the most advantageous direction, is not, perhaps,
      altogether so evident.

      The general industry of the society can never exceed what the capital of
      the society can employ. As the number of workmen that can be kept in
      employment by any particular person must bear a certain proportion to his
      capital, so the number of those that can be continually employed by all
      the members of a great society must bear a certain proportion to the whole
      capital of the society, and never can exceed that proportion. No
      regulation of commerce can increase the quantity of industry in any
      society beyond what its capital can maintain. It can only divert a part of
      it into a direction into which it might not otherwise have gone; and it is
      by no means certain that this artificial direction is likely to be more
      advantageous to the society, than that into which it would have gone of
      its own accord.

      Every individual is continually exerting himself to find out the most
      advantageous employment for whatever capital he can command. It is his own
      advantage, indeed, and not that of the society, which he has in view. But
      the study of his own advantage naturally, or rather necessarily, leads him
      to prefer that employment which is most advantageous to the society.

      First, every individual endeavours to employ his capital as near home as
      he can, and consequently as much as he can in the support of domestic
      industry, provided always that he can thereby obtain the ordinary, or not
      a great deal less than the ordinary profits of stock.

      Thus, upon equal, or nearly equal profits, every wholesale merchant
      naturally prefers the home trade to the foreign trade of consumption, and
      the foreign trade of consumption to the carrying trade. In the home trade,
      his capital is never so long out of his sight as it frequently is in the
      foreign trade of consumption. He can know better the character and
      situation of the persons whom he trusts; and if he should happen to be
      deceived, he knows better the laws of the country from which he must seek
      redress. In the carrying trade, the capital of the merchant is, as it
      were, divided between two foreign countries, and no part of it is ever
      necessarily brought home, or placed under his own immediate view and
      command. The capital which an Amsterdam merchant employs in carrying corn
      from Koningsberg to Lisbon, and fruit and wine from Lisbon to Koningsberg,
      must generally be the one half of it at Koningsberg, and the other half at
      Lisbon. No part of it need ever come to Amsterdam. The natural residence
      of such a merchant should either be at Koningsberg or Lisbon; and it can
      only be some very particular circumstances which can make him prefer the
      residence of Amsterdam. The uneasiness, however, which he feels at being
      separated so far from his capital, generally determines him to bring part
      both of the Koningsberg goods which he destines for the market of Lisbon,
      and of the Lisbon goods which he destines for that of Koningsberg, to
      Amsterdam; and though this necessarily subjects him to a double charge of
      loading and unloading as well as to the payment of some duties and
      customs, yet, for the sake of having some part of his capital always under
      his own view and command, he willingly submits to this extraordinary
      charge; and it is in this manner that every country which has any
      considerable share of the carrying trade, becomes always the emporium, or
      general market, for the goods of all the different countries whose trade
      it carries on. The merchant, in order to save a second loading and
      unloading, endeavours always to sell in the home market, as much of the
      goods of all those different countries as he can; and thus, so far as he
      can, to convert his carrying trade into a foreign trade of consumption. A
      merchant, in the same manner, who is engaged in the foreign trade of
      consumption, when he collects goods for foreign markets, will always be
      glad, upon equal or nearly equal profits, to sell as great a part of them
      at home as he can. He saves himself the risk and trouble of exportation,
      when, so far as he can, he thus converts his foreign trade of consumption
      into a home trade. Home is in this manner the centre, if I may say so,
      round which the capitals of the inhabitants of every country are
      continually circulating, and towards which they are always tending,
      though, by particular causes, they may sometimes be driven off and
      repelled from it towards more distant employments. But a capital employed
      in the home trade, it has already been shown, necessarily puts into motion
      a greater quantity of domestic industry, and gives revenue and employment
      to a greater number of the inhabitants of the country, than an equal
      capital employed in the foreign trade of consumption; and one employed in
      the foreign trade of consumption has the same advantage over an equal
      capital employed in the carrying trade. Upon equal, or only nearly equal
      profits, therefore, every individual naturally inclines to employ his
      capital in the manner in which it is likely to afford the greatest support
      to domestic industry, and to give revenue and employment to the greatest
      number of people of his own country.

      Secondly, every individual who employs his capital in the support of
      domestic industry, necessarily endeavours so to direct that industry, that
      its produce may be of the greatest possible value.

      The produce of industry is what it adds to the subject or materials upon
      which it is employed. In proportion as the value of this produce is great
      or small, so will likewise be the profits of the employer. But it is only
      for the sake of profit that any man employs a capital in the support of
      industry; and he will always, therefore, endeavour to employ it in the
      support of that industry of which the produce is likely to be of the
      greatest value, or to exchange for the greatest quantity either of money
      or of other goods.

      But the annual revenue of every society is always precisely equal to the
      exchangeable value of the whole annual produce of its industry, or rather
      is precisely the same thing with that exchangeable value. As every
      individual, therefore, endeavours as much as he can, both to employ his
      capital in the support of domestic industry, and so to direct that
      industry that its produce maybe of the greatest value; every individual
      necessarily labours to render the annual revenue of the society as great
      as he can. He generally, indeed, neither intends to promote the public
      interest, nor knows how much he is promoting it. By preferring the support
      of domestic to that of foreign industry, he intends only his own security;
      and by directing that industry in such a manner as its produce may be of
      the greatest value, he intends only his own gain; and he is in this, as in
      many other cases, led by an invisible hand to promote an end which was no
      part of his intention. Nor is it always the worse for the society that it
      was no part of it. By pursuing his own interest, he frequently promotes
      that of the society more effectually than when he really intends to
      promote it. I have never known much good done by those who affected to
      trade for the public good. It is an affectation, indeed, not very common
      among merchants, and very few words need be employed in dissuading them
      from it.

      What is the species of domestic industry which his capital can employ, and
      of which the produce is likely to be of the greatest value, every
      individual, it is evident, can in his local situation judge much better
      than any statesman or lawgiver can do for him. The statesman, who should
      attempt to direct private people in what manner they ought to employ their
      capitals, would not only load himself with a most unnecessary attention,
      but assume an authority which could safely be trusted, not only to no
      single person, but to no council or senate whatever, and which would
      nowhere be so dangerous as in the hands of a man who had folly and
      presumption enough to fancy himself fit to exercise it.

      To give the monopoly of the home market to the produce of domestic
      industry, in any particular art or manufacture, is in some measure to
      direct private people in what manner they ought to employ their capitals,
      and must in almost all cases be either a useless or a hurtful regulation.
      If the produce of domestic can be brought there as cheap as that of
      foreign industry, the regulation is evidently useless. If it cannot, it
      must generally be hurtful. It is the maxim of every prudent master of a
      family, never to attempt to make at home what it will cost him more to
      make than to buy. The tailor does not attempt to make his own shoes, but
      buys them of the shoemaker. The shoemaker does not attempt to make his own
      clothes, but employs a tailor. The farmer attempts to make neither the one
      nor the other, but employs those different artificers. All of them find it
      for their interest to employ their whole industry in a way in which they
      have some advantage over their neighbours, and to purchase with a part of
      its produce, or, what is the same thing, with the price of a part of it,
      whatever else they have occasion for.

      What is prudence in the conduct of every private family, can scarce be
      folly in that of a great kingdom. If a foreign country can supply us with
      a commodity cheaper than we ourselves can make it, better buy it of them
      with some part of the produce of our own industry, employed in a way in
      which we have some advantage. The general industry of the country being
      always in proportion to the capital which employs it, will not thereby be
      diminished, no more than that of the abovementioned artificers; but only
      left to find out the way in which it can be employed with the greatest
      advantage. It is certainly not employed to the greatest advantage, when it
      is thus directed towards an object which it can buy cheaper than it can
      make. The value of its annual produce is certainly more or less
      diminished, when it is thus turned away from producing commodities
      evidently of more value than the commodity which it is directed to
      produce. According to the supposition, that commodity could be purchased
      from foreign countries cheaper than it can be made at home; it could
      therefore have been purchased with a part only of the commodities, or,
      what is the same thing, with a part only of the price of the commodities,
      which the industry employed by an equal capital would have produced at
      home, had it been left to follow its natural course. The industry of the
      country, therefore, is thus turned away from a more to a less advantageous
      employment; and the exchangeable value of its annual produce, instead of
      being increased, according to the intention of the lawgiver, must
      necessarily be diminished by every such regulation.

      By means of such regulations, indeed, a particular manufacture may
      sometimes be acquired sooner than it could have been otherwise, and after
      a certain time may be made at home as cheap, or cheaper, than in the
      foreign country. But though the industry of the society may be thus
      carried with advantage into a particular channel sooner than it could have
      been otherwise, it will by no means follow that the sum-total, either of
      its industry, or of its revenue, can ever be augmented by any such
      regulation. The industry of the society can augment only in proportion as
      its capital augments, and its capital can augment only in proportion to
      what can be gradually saved out of its revenue. But the immediate effect
      of every such regulation is to diminish its revenue; and what diminishes
      its revenue is certainly not very likely to augment its capital faster
      than it would have augmented of its own accord, had both capital and
      industry been left to find out their natural employments.

      Though, for want of such regulations, the society should never acquire the
      proposed manufacture, it would not upon that account necessarily be the
      poorer in anyone period of its duration. In every period of its duration
      its whole capital and industry might still have been employed, though upon
      different objects, in the manner that was most advantageous at the time.
      In every period its revenue might have been the greatest which its capital
      could afford, and both capital and revenue might have been augmented with
      the greatest possible rapidity.

      The natural advantages which one country has over another, in producing
      particular commodities, are sometimes so great, that it is acknowledged by
      all the world to be in vain to struggle with them. By means of glasses,
      hot-beds, and hot-walls, very good grapes can be raised in Scotland, and
      very good wine, too, can be made of them, at about thirty times the
      expense for which at least equally good can be brought from foreign
      countries. Would it be a reasonable law to prohibit the importation of all
      foreign wines, merely to encourage the making of claret and Burgundy in
      Scotland? But if there would be a manifest absurdity in turning towards
      any employment thirty times more of the capital and industry of the
      country than would be necessary to purchase from foreign countries an
      equal quantity of the commodities wanted, there must be an absurdity,
      though not altogether so glaring, yet exactly of the same kind, in turning
      towards any such employment a thirtieth, or even a three hundredth part
      more of either. Whether the advantages which one country has over another
      be natural or acquired, is in this respect of no consequence. As long as
      the one country has those advantages, and the other wants them, it will
      always be more advantageous for the latter rather to buy of the former
      than to make. It is an acquired advantage only, which one artificer has
      over his neighbour, who exercises another trade; and yet they both find it
      more advantageous to buy of one another, than to make what does not belong
      to their particular trades.

      Merchants and manufacturers are the people who derive the greatest
      advantage from this monopoly of the home market. The prohibition of the
      importation of foreign cattle and of salt provisions, together with the
      high duties upon foreign corn, which in times of moderate plenty amount to
      a prohibition, are not near so advantageous to the graziers and farmers of
      Great Britain, as other regulations of the same kind are to its merchants
      and manufacturers. Manufactures, those of the finer kind especially, are
      more easily transported from one country to another than corn or cattle.
      It is in the fetching and carrying manufactures, accordingly, that foreign
      trade is chiefly employed. In manufactures, a very small advantage will
      enable foreigners to undersell our own workmen, even in the home market.
      It will require a very great one to enable them to do so in the rude
      produce of the soil. If the free importation of foreign manufactures were
      permitted, several of the home manufactures would probably suffer, and
      some of them perhaps go to ruin altogether, and a considerable part of the
      stock and industry at present employed in them, would be forced to find
      out some other employment. But the freest importation of the rude produce
      of the soil could have no such effect upon the agriculture of the country.

      If the importation of foreign cattle, for example, were made ever so free,
      so few could be imported, that the grazing trade of Great Britain could be
      little affected by it. Live cattle are, perhaps, the only commodity of
      which the transportation is more expensive by sea than by land. By land
      they carry themselves to market. By sea, not only the cattle, but their
      food and their water too, must be carried at no small expense and
      inconveniency. The short sea between Ireland and Great Britain, indeed,
      renders the importation of Irish cattle more easy. But though the free
      importation of them, which was lately permitted only for a limited time,
      were rendered perpetual, it could have no considerable effect upon the
      interest of the graziers of Great Britain. Those parts of Great Britain
      which border upon the Irish sea are all grazing countries. Irish cattle
      could never be imported for their use, but must be drove through those
      very extensive countries, at no small expense and inconveniency, before
      they could arrive at their proper market. Fat cattle could not be drove so
      far. Lean cattle, therefore, could only be imported; and such importation
      could interfere not with the interest of the feeding or fattening
      countries, to which, by reducing the price of lean cattle it would rather
      be advantageous, but with that of the breeding countries only. The small
      number of Irish cattle imported since their importation was permitted,
      together with the good price at which lean cattle still continue to sell,
      seem to demonstrate, that even the breeding countries of Great Britain are
      never likely to be much affected by the free importation of Irish cattle.
      The common people of Ireland, indeed, are said to have sometimes opposed
      with violence the exportation of their cattle. But if the exporters had
      found any great advantage in continuing the trade, they could easily, when
      the law was on their side, have conquered this mobbish opposition.

      Feeding and fattening countries, besides, must always be highly improved,
      whereas breeding countries are generally uncultivated. The high price of
      lean cattle, by augmenting the value of uncultivated land, is like a
      bounty against improvement. To any country which was highly improved
      throughout, it would be more advantageous to import its lean cattle than
      to breed them. The province of Holland, accordingly, is said to follow
      this maxim at present. The mountains of Scotland, Wales, and
      Northumberland, indeed, are countries not capable of much improvement, and
      seem destined by nature to be the breeding countries of Great Britain. The
      freest importation of foreign cattle could have no other effect than to
      hinder those breeding countries from taking advantage of the increasing
      population and improvement of the rest of the kingdom, from raising their
      price to an exorbitant height, and from laying a real tax upon all the
      more improved and cultivated parts of the country.

      The freest importation of salt provisions, in the same manner, could have
      as little effect upon the interest of the graziers of Great Britain as
      that of live cattle. Salt provisions are not only a very bulky commodity,
      but when compared with fresh meat they are a commodity both of worse
      quality, and, as they cost more labour and expense, of higher price. They
      could never, therefore, come into competition with the fresh meat, though
      they might with the salt provisions of the country. They might be used for
      victualling ships for distant voyages, and such like uses, but could never
      make any considerable part of the food of the people. The small quantity
      of salt provisions imported from Ireland since their importation was
      rendered free, is an experimental proof that our graziers have nothing to
      apprehend from it. It does not appear that the price of butcher’s meat has
      ever been sensibly affected by it.

      Even the free importation of foreign corn could very little affect the
      interest of the farmers of Great Britain. Corn is a much more bulky
      commodity than butcher’s meat. A pound of wheat at a penny is as dear as a
      pound of butcher’s meat at fourpence. The small quantity of foreign corn
      imported even in times of the greatest scarcity, may satisfy our farmers
      that they can have nothing to fear from the freest importation. The
      average quantity imported, one year with another, amounts only, according
      to the very well informed author of the Tracts upon the Corn Trade, to
      23,728 quarters of all sorts of grain, and does not exceed the five
      hundredth and seventy-one part of the annual consumption. But as the
      bounty upon corn occasions a greater exportation in years of plenty, so it
      must, of consequence, occasion a greater importation in years of scarcity,
      than in the actual state of tillage would otherwise take place. By means
      of it, the plenty of one year does not compensate the scarcity of another;
      and as the average quantity exported is necessarily augmented by it, so
      must likewise, in the actual state of tillage, the average quantity
      imported. If there were no bounty, as less corn would be exported, so it
      is probable that, one year with another, less would be imported than at
      present. The corn-merchants, the fetchers and carriers of corn between
      Great Britain and foreign countries, would have much less employment, and
      might suffer considerably; but the country gentlemen and farmers could
      suffer very little. It is in the corn-merchants, accordingly, rather than
      the country gentlemen and farmers, that I have observed the greatest
      anxiety for the renewal and continuation of the bounty.

      Country gentlemen and farmers are, to their great honour, of all people,
      the least subject to the wretched spirit of monopoly. The undertaker of a
      great manufactory is sometimes alarmed if another work of the same kind is
      established within twenty miles of him; the Dutch undertaker of the
      woollen manufacture at Abbeville, stipulated that no work of the same kind
      should be established within thirty leagues of that city. Farmers and
      country gentlemen, on the contrary, are generally disposed rather to
      promote, than to obstruct, the cultivation and improvement of their
      neighbours farms and estates. They have no secrets, such as those of the
      greater part of manufacturers, but are generally rather fond of
      communicating to their neighbours, and of extending as far as possible any
      new practice which they may have found to be advantageous. “Pius
      quaestus”, says old Cato, “stabilissimusque, minimeque invidiosus;
      minimeque male cogitantes sunt, qui in eo studio occupati sunt.” Country
      gentlemen and farmers, dispersed in different parts of the country, cannot
      so easily combine as merchants and manufacturers, who being collected into
      towns, and accustomed to that exclusive corporation spirit which prevails
      in them, naturally endeavour to obtain, against all their countrymen, the
      same exclusive privilege which they generally possess against the
      inhabitants of their respective towns. They accordingly seem to have been
      the original inventors of those restraints upon the importation of foreign
      goods, which secure to them the monopoly of the home market. It was
      probably in imitation of them, and to put themselves upon a level with
      those who, they found, were disposed to oppress them, that the country
      gentlemen and farmers of Great Britain so far forgot the generosity which
      is natural to their station, as to demand the exclusive privilege of
      supplying their countrymen with corn and butcher’s meat. They did not,
      perhaps, take time to consider how much less their interest could be
      affected by the freedom of trade, than that of the people whose example
      they followed.

      To prohibit, by a perpetual law, the importation of foreign corn and
      cattle, is in reality to enact, that the population and industry of the
      country shall, at no time, exceed what the rude produce of its own soil
      can maintain.

      There seem, however, to be two cases, in which it will generally be
      advantageous to lay some burden upon foreign, for the encouragement of
      domestic industry.

      The first is, when some particular sort of industry is necessary for the
      defence of the country. The defence of Great Britain, for example, depends
      very much upon the number of its sailors and shipping. The act of
      navigation, therefore, very properly endeavours to give the sailors and
      shipping of Great Britain the monopoly of the trade of their own country,
      in some cases, by absolute prohibitions, and in others, by heavy burdens
      upon the shipping of foreign countries. The following are the principal
      dispositions of this act.

      First, All ships, of which the owners, masters, and three-fourths of the
      mariners, are not British subjects, are prohibited, upon pain of
      forfeiting ship and cargo, from trading to the British settlements and
      plantations, or from being employed in the coasting trade of Great
      Britain.

      Secondly, A great variety of the most bulky articles of importation can be
      brought into Great Britain only, either in such ships as are above
      described, or in ships of the country where those goods are produced, and
      of which the owners, masters, and three-fourths of the mariners, are of
      that particular country; and when imported even in ships of this latter
      kind, they are subject to double aliens duty. If imported in ships of any
      other country, the penalty is forfeiture of ship and goods. When this act
      was made, the Dutch were, what they still are, the great carriers of
      Europe; and by this regulation they were entirely excluded from being the
      carriers to Great Britain, or from importing to us the goods of any other
      European country.

      Thirdly, A great variety of the most bulky articles of importation are
      prohibited from being imported, even in British ships, from any country
      but that in which they are produced, under pain of forfeiting ship and
      cargo. This regulation, too, was probably intended against the Dutch.
      Holland was then, as now, the great emporium for all European goods; and
      by this regulation, British ships were hindered from loading in Holland
      the goods of any other European country.

      Fourthly, Salt fish of all kinds, whale fins, whalebone, oil, and blubber,
      not caught by and cured on board British vessels, when imported into Great
      Britain, are subject to double aliens duty. The Dutch, as they are still
      the principal, were then the only fishers in Europe that attempted to
      supply foreign nations with fish. By this regulation, a very heavy burden
      was laid upon their supplying Great Britain.

      When the act of navigation was made, though England and Holland were not
      actually at war, the most violent animosity subsisted between the two
      nations. It had begun during the government of the long parliament, which
      first framed this act, and it broke out soon after in the Dutch wars,
      during that of the Protector and of Charles II. It is not impossible,
      therefore, that some of the regulations of this famous act may have
      proceeded from national animosity. They are as wise, however, as if they
      had all been dictated by the most deliberate wisdom. National animosity,
      at that particular time, aimed at the very same object which the most
      deliberate wisdom would have recommended, the diminution of the naval
      power of Holland, the only naval power which could endanger the security
      of England.

      The act of navigation is not favourable to foreign commerce, or to the
      growth of that opulence which can arise from it. The interest of a nation,
      in its commercial relations to foreign nations, is, like that of a
      merchant with regard to the different people with whom he deals, to buy as
      cheap, and to sell as dear as possible. But it will be most likely to buy
      cheap, when, by the most perfect freedom of trade, it encourages all
      nations to bring to it the goods which it has occasion to purchase; and,
      for the same reason, it will be most likely to sell dear, when its markets
      are thus filled with the greatest number of buyers. The act of navigation,
      it is true, lays no burden upon foreign ships that come to export the
      produce of British industry. Even the ancient aliens duty, which used to
      be paid upon all goods, exported as well as imported, has, by several
      subsequent acts, been taken off from the greater part of the articles of
      exportation. But if foreigners, either by prohibitions or high duties, are
      hindered from coming to sell, they cannot always afford to come to buy;
      because, coming without a cargo, they must lose the freight from their own
      country to Great Britain. By diminishing the number of sellers, therefore,
      we necessarily diminish that of buyers, and are thus likely not only to
      buy foreign goods dearer, but to sell our own cheaper, than if there was a
      more perfect freedom of trade. As defence, however, is of much more
      importance than opulence, the act of navigation is, perhaps, the wisest of
      all the commercial regulations of England.

      The second case, in which it will generally be advantageous to lay some
      burden upon foreign for the encouragement of domestic industry, is when
      some tax is imposed at home upon the produce of the latter. In this case,
      it seems reasonable that an equal tax should be imposed upon the like
      produce of the former. This would not give the monopoly of the home
      market to domestic industry, nor turn towards a particular employment a
      greater share of the stock and labour of the country, than what would
      naturally go to it. It would only hinder any part of what would naturally
      go to it from being turned away by the tax into a less natural direction,
      and would leave the competition between foreign and domestic industry,
      after the tax, as nearly as possible upon the same footing as before it.
      In Great Britain, when any such tax is laid upon the produce of domestic
      industry, it is usual, at the same time, in order to stop the clamorous
      complaints of our merchants and manufacturers, that they will be undersold
      at home, to lay a much heavier duty upon the importation of all foreign
      goods of the same kind.

      This second limitation of the freedom of trade, according to some people,
      should, upon most occasions, be extended much farther than to the precise
      foreign commodities which could come into competition with those which had
      been taxed at home. When the necessaries of life have been taxed in any
      country, it becomes proper, they pretend, to tax not only the like
      necessaries of life imported from other countries, but all sorts of
      foreign goods which can come into competition with any thing that is the
      produce of domestic industry. Subsistence, they say, becomes necessarily
      dearer in consequence of such taxes; and the price of labour must always
      rise with the price of the labourer’s subsistence. Every commodity,
      therefore, which is the produce of domestic industry, though not
      immediately taxed itself, becomes dearer in consequence of such taxes,
      because the labour which produces it becomes so. Such taxes, therefore,
      are really equivalent, they say, to a tax upon every particular commodity
      produced at home. In order to put domestic upon the same footing with
      foreign industry, therefore, it becomes necessary, they think, to lay some
      duty upon every foreign commodity, equal to this enhancement of the price
      of the home commodities with which it can come into competition.

      Whether taxes upon the necessaries of life, such as those in Great Britain
      upon soap, salt, leather, candles, etc. necessarily raise the price of
      labour, and consequently that of all other commodities, I shall consider
      hereafter, when I come to treat of taxes. Supposing, however, in the mean
      time, that they have this effect, and they have it undoubtedly, this
      general enhancement of the price of all commodities, in consequence of
      that labour, is a case which differs in the two following respects from
      that of a particular commodity, of which the price was enhanced by a
      particular tax immediately imposed upon it.

      First, It might always be known with great exactness, how far the price of
      such a commodity could be enhanced by such a tax; but how far the general
      enhancement of the price of labour might affect that of every different
      commodity about which labour was employed, could never be known with any
      tolerable exactness. It would be impossible, therefore, to proportion,
      with any tolerable exactness, the tax of every foreign, to the enhancement
      of the price of every home commodity.

      Secondly, Taxes upon the necessaries of life have nearly the same effect
      upon the circumstances of the people as a poor soil and a bad climate.
      Provisions are thereby rendered dearer, in the same manner as if it
      required extraordinary labour and expense to raise them. As, in the
      natural scarcity arising from soil and climate, it would be absurd to
      direct the people in what manner they ought to employ their capitals and
      industry, so is it likewise in the artificial scarcity arising from such
      taxes. To be left to accommodate, as well as they could, their industry to
      their situation, and to find out those employments in which,
      notwithstanding their unfavourable circumstances, they might have some
      advantage either in the home or in the foreign market, is what, in both
      cases, would evidently be most for their advantage. To lay a new-tax upon
      them, because they are already overburdened with taxes, and because they
      already pay too dear for the necessaries of life, to make them likewise
      pay too dear for the greater part of other commodities, is certainly a
      most absurd way of making amends.

      Such taxes, when they have grown up to a certain height, are a curse equal
      to the barrenness of the earth, and the inclemency of the heavens, and yet
      it is in the richest and most industrious countries that they have been
      most generally imposed. No other countries could support so great a
      disorder. As the strongest bodies only can live and enjoy health under an
      unwholesome regimen, so the nations only, that in every sort of industry
      have the greatest natural and acquired advantages, can subsist and prosper
      under such taxes. Holland is the country in Europe in which they abound
      most, and which, from peculiar circumstances, continues to prosper, not by
      means of them, as has been most absurdly supposed, but in spite of them.

      As there are two cases in which it will generally be advantageous to lay
      some burden upon foreign for the encouragement of domestic industry, so
      there are two others in which it may sometimes be a matter of
      deliberation, in the one, how far it is proper to continue the free
      importation of certain foreign goods; and, in the other, how far, or in
      what manner, it may be proper to restore that free importation, after it
      has been for some time interrupted.

      The case in which it may sometimes be a matter of deliberation how far it
      is proper to continue the free importation of certain foreign goods, is
      when some foreign nation restrains, by high duties or prohibitions, the
      importation of some of our manufactures into their country. Revenge, in
      this case, naturally dictates retaliation, and that we should impose the
      like duties and prohibitions upon the importation of some or all of their
      manufactures into ours. Nations, accordingly, seldom fail to retaliate in
      this manner. The French have been particularly forward to favour their own
      manufactures, by restraining the importation of such foreign goods as
      could come into competition with them. In this consisted a great part of
      the policy of Mr Colbert, who, notwithstanding his great abilities, seems
      in this case to have been imposed upon by the sophistry of merchants and
      manufacturers, who are always demanding a monopoly against their
      countrymen. It is at present the opinion of the most intelligent men in
      France, that his operations of this kind have not been beneficial to his
      country. That minister, by the tariff of 1667, imposed very high duties
      upon a great number of foreign manufactures. Upon his refusing to moderate
      them in favour of the Dutch, they, in 1671, prohibited the importation of
      the wines, brandies, and manufactures of France. The war of 1672 seems to
      have been in part occasioned by this commercial dispute. The peace of
      Nimeguen put an end to it in 1678, by moderating some of those duties in
      favour of the Dutch, who in consequence took off their prohibition. It was
      about the same time that the French and English began mutually to oppress
      each other’s industry, by the like duties and prohibitions, of which the
      French, however, seem to have set the first example, The spirit of
      hostility which has subsisted between the two nations ever since, has
      hitherto hindered them from being moderated on either side. In 1697, the
      English prohibited the importation of bone lace, the manufacture of
      Flanders. The government of that country, at that time under the dominion
      of Spain, prohibited, in return, the importation of English woollens. In
      1700, the prohibition of importing bone lace into England was taken off
      upon condition that the importation of English woollens into Flanders
      should be put on the same footing as before.

      There may be good policy in retaliations of this kind, when there is a
      probability that they will procure the repeal of the high duties or
      prohibitions complained of. The recovery of a great foreign market will
      generally more than compensate the transitory inconveniency of paying
      dearer during a short time for some sorts of goods. To judge whether such
      retaliations are likely to produce such an effect, does not, perhaps,
      belong so much to the science of a legislator, whose deliberations ought
      to be governed by general principles, which are always the same, as to the
      skill of that insidious and crafty animal vulgarly called a statesman or
      politician, whose councils are directed by the momentary fluctuations of
      affairs. When there is no probability that any such repeal can be
      procured, it seems a bad method of compensating the injury done to certain
      classes of our people, to do another injury ourselves, not only to those
      classes, but to almost all the other classes of them. When our neighbours
      prohibit some manufacture of ours, we generally prohibit, not only the
      same, for that alone would seldom affect them considerably, but some other
      manufacture of theirs. This may, no doubt, give encouragement to some
      particular class of workmen among ourselves, and, by excluding some of
      their rivals, may enable them to raise their price in the home market.
      Those workmen however, who suffered by our neighbours prohibition, will
      not be benefited by ours. On the contrary, they, and almost all the other
      classes of our citizens, will thereby be obliged to pay dearer than before
      for certain goods. Every such law, therefore, imposes a real tax upon the
      whole country, not in favour of that particular class of workmen who were
      injured by our neighbours prohibitions, but of some other class.

      The case in which it may sometimes be a matter of deliberation, how far,
      or in what manner, it is proper to restore the free importation of foreign
      goods, after it has been for some time interrupted, is when particular
      manufactures, by means of high duties or prohibitions upon all foreign
      goods which can come into competition with them, have been so far extended
      as to employ a great multitude of hands. Humanity may in this case require
      that the freedom of trade should be restored only by slow gradations, and
      with a good deal of reserve and circumspection. Were those high duties and
      prohibitions taken away all at once, cheaper foreign goods of the same
      kind might be poured so fast into the home market, as to deprive all at
      once many thousands of our people of their ordinary employment and means
      of subsistence. The disorder which this would occasion might no doubt be
      very considerable. It would in all probability, however, be much less than
      is commonly imagined, for the two following reasons.

      First, All those manufactures of which any part is commonly exported to
      other European countries without a bounty, could be very little affected
      by the freest importation of foreign goods. Such manufactures must be sold
      as cheap abroad as any other foreign goods of the same quality and kind,
      and consequently must be sold cheaper at home. They would still,
      therefore, keep possession of the home market; and though a capricious man
      of fashion might sometimes prefer foreign wares, merely because they were
      foreign, to cheaper and better goods of the same kind that were made at
      home, this folly could, from the nature of things, extend to so few, that
      it could make no sensible impression upon the general employment of the
      people. But a great part of all the different branches of our woollen
      manufacture, of our tanned leather, and of our hardware, are annually
      exported to other European countries without any bounty, and these are the
      manufactures which employ the greatest number of hands. The silk, perhaps,
      is the manufacture which would suffer the most by this freedom of trade,
      and after it the linen, though the latter much less than the former.

      Secondly, Though a great number of people should, by thus restoring the
      freedom of trade, be thrown all at once out of their ordinary employment
      and common method of subsistence, it would by no means follow that they
      would thereby be deprived either of employment or subsistence. By the
      reduction of the army and navy at the end of the late war, more than
      100,000 soldiers and seamen, a number equal to what is employed in the
      greatest manufactures, were all at once thrown out of their ordinary
      employment: but though they no doubt suffered some inconveniency, they
      were not thereby deprived of all employment and subsistence. The greater
      part of the seamen, it is probable, gradually betook themselves to the
      merchant service as they could find occasion, and in the mean time both
      they and the soldiers were absorbed in the great mass of the people, and
      employed in a great variety of occupations. Not only no great convulsion,
      but no sensible disorder, arose from so great a change in the situation of
      more than 100,000 men, all accustomed to the use of arms, and many of them
      to rapine and plunder. The number of vagrants was scarce anywhere sensibly
      increased by it; even the wages of labour were not reduced by it in any
      occupation, so far as I have been able to learn, except in that of seamen
      in the merchant service. But if we compare together the habits of a
      soldier and of any sort of manufacturer, we shall find that those of the
      latter do not tend so much to disqualify him from being employed in a new
      trade, as those of the former from being employed in any. The manufacturer
      has always been accustomed to look for his subsistence from his labour
      only; the soldier to expect it from his pay. Application and industry have
      been familiar to the one; idleness and dissipation to the other. But it is
      surely much easier to change the direction of industry from one sort of
      labour to another, than to turn idleness and dissipation to any. To the
      greater part of manufactures, besides, it has already been observed, there
      are other collateral manufactures of so similar a nature, that a workman
      can easily transfer his industry from one of them to another. The greater
      part of such workmen, too, are occasionally employed in country labour.
      The stock which employed them in a particular manufacture before, will
      still remain in the country, to employ an equal number of people in some
      other way. The capital of the country remaining the same, the demand for
      labour will likewise be the same, or very nearly the same, though it may
      be exerted in different places, and for different occupations. Soldiers
      and seamen, indeed, when discharged from the king’s service, are at
      liberty to exercise any trade within any town or place of Great Britain or
      Ireland. Let the same natural liberty of exercising what species of
      industry they please, be restored to all his Majesty’s subjects, in the
      same manner as to soldiers and seamen; that is, break down the exclusive
      privileges of corporations, and repeal the statute of apprenticeship, both
      which are really encroachments upon natural Liberty, and add to those the
      repeal of the law of settlements, so that a poor workman, when thrown out
      of employment, either in one trade or in one place, may seek for it in
      another trade or in another place, without the fear either of a
      prosecution or of a removal; and neither the public nor the individuals
      will suffer much more from the occasional disbanding some particular
      classes of manufacturers, than from that of the soldiers. Our
      manufacturers have no doubt great merit with their country, but they
      cannot have more than those who defend it with their blood, nor deserve to
      be treated with more delicacy.

      To expect, indeed, that the freedom of trade should ever be entirely
      restored in Great Britain, is as absurd as to expect that an Oceana or
      Utopia should ever be established in it. Not only the prejudices of the
      public, but, what is much more unconquerable, the private interests of
      many individuals, irresistibly oppose it. Were the officers of the army to
      oppose, with the same zeal and unanimity, any reduction in the number of
      forces, with which master manufacturers set themselves against every law
      that is likely to increase the number of their rivals in the home market;
      were the former to animate their soldiers, in the same manner as the
      latter inflame their workmen, to attack with violence and outrage the
      proposers of any such regulation; to attempt to reduce the army would be
      as dangerous as it has now become to attempt to diminish, in any respect,
      the monopoly which our manufacturers have obtained against us. This
      monopoly has so much increased the number of some particular tribes of
      them, that, like an overgrown standing army, they have become formidable
      to the government, and, upon many occasions, intimidate the legislature.
      The member of parliament who supports every proposal for strengthening
      this monopoly, is sure to acquire not only the reputation of understanding
      trade, but great popularity and influence with an order of men whose
      numbers and wealth render them of great importance. If he opposes them, on
      the contrary, and still more, if he has authority enough to be able to
      thwart them, neither the most acknowledged probity, nor the highest rank,
      nor the greatest public services, can protect him from the most infamous
      abuse and detraction, from personal insults, nor sometimes from real
      danger, arising from the insolent outrage of furious and disappointed
      monopolists.

      The undertaker of a great manufacture, who, by the home markets being
      suddenly laid open to the competition of foreigners, should be obliged to
      abandon his trade, would no doubt suffer very considerably. That part of
      his capital which had usually been employed in purchasing materials, and
      in paying his workmen, might, without much difficulty, perhaps, find
      another employment; but that part of it which was fixed in workhouses, and
      in the instruments of trade, could scarce be disposed of without
      considerable loss. The equitable regard, therefore, to his interest,
      requires that changes of this kind should never be introduced suddenly,
      but slowly, gradually, and after a very long warning. The legislature,
      were it possible that its deliberations could be always directed, not by
      the clamorous importunity of partial interests, but by an extensive view
      of the general good, ought, upon this very account, perhaps, to be
      particularly careful, neither to establish any new monopolies of this
      kind, nor to extend further those which are already established. Every
      such regulation introduces some degree of real disorder into the
      constitution of the state, which it will be difficult afterwards to cure
      without occasioning another disorder.

      How far it may be proper to impose taxes upon the importation of foreign
      goods, in order not to prevent their importation, but to raise a revenue
      for government, I shall consider hereafter when I come to treat of taxes.
      Taxes imposed with a view to prevent, or even to diminish importation, are
      evidently as destructive of the revenue of the customs as of the freedom
      of trade.