The ardour, with which all governments have excited every species of production, by means of their restrictive system, has brought about such a disproportion between labour and demand, that perhaps it has become necessary for every state to think first, not of the comfort, but of the existence of its subjects, and to maintain those barriers which have been so imprudently erected. An important part of the population might, perhaps, be cut off by penury, in the course of a few years; and it is reasonable that each state should seek to preserve itself and those depending on it from such a calamity. Yet, we cannot without pain, behold the rivetting of this anti-social system, and the abandonment of that ancient spirit of commerce, which triumphed over barbarism, and taught hostile hordes to know and esteem each other.
Governments, after having attempted to give the national producers a monopoly in their own country, have sometimes endeavoured to procure them a similar advantage in foreign countries, by treaties of commerce. Such actions, always subordinate to policy, granted to a favoured nation an exemption from some part of the duties required from others, on consideration of some reciprocal advantage. It cannot be doubted that such an exemption was advantageous to the nation in whose favour it was granted; but, on the other hand, it was just as disadvantageous to the nation granting it; and when a treaty of commerce bore a concession of mutual exemption, each state should have discovered, that a monopoly granted to its producers was too dearly purchased by a monopoly granted to foreigners, against its consumers: and the more so, as there existed no kind of relation between the two favoured branches of trade. Some show of reason may be discovered, why the consumers of cloth should be taxed for the advantage of cloth manufacturers; but there is no shallow of reason why the consumers of wine in England should experience a loss, in compensation for an advantage to the sellers of goods in Portugal.
No treaty of commerce can fully satisfy the greediness of merchants desiring a monopoly; and therefore governments invented the fanatic expedient of creating in a colony a nation expressly to be purchasers from their merchants. The colonists were prohibited from establishing any manufacture at home, that so they might be more dependent on the mother country. They were carefully prevented from following any species of foreign trade; they were subjected to regulations the most vexatious, and contrary to their own interests; not for the mother country's good, but for the good of a small number of merchants. The infinite advantages attached to a new country, where every kind of labour is profitable, because every thing is yet to do, enabled colonies to prosper, although they were continually sacrificed. As their raw produce was fit for a distant trade, they had it in their power to support a most unequal exchange, in which nothing was taken from them that the buyer could procure at home; but their rapid increase itself bears witness against the system which has founded them; they have prospered by a system diametrically opposite to that followed by the mother country.
The exportation of all raw produce, the importation of all wrought produce, has been encouraged in colonies, and have presented to such as believe in the existence, and calculate the state, of a commercial balance, a result as disadvantageous for themselves, as it was advantageous for the mother country.
Doubtless, their oppression gave the latter all the profits of a monopoly; yet, in a very circumscribed market; whilst the free trade of all Europe, with all its colonies, would have been more advantageous for both, by infinitely extending the market of the one, and accelerating the progress of the other. What justice and policy should have taught, force will obtain, and the colonial system cannot long continue.
Governments, in the last place, to favour commerce, have granted it bounties and drawbacks. A bounty is a reward which the state decrees to the manufacturer, on account of his goods, which comes to him in the shape of profit. A drawback is a restitution of all the taxes, which a piece of goods had paid, granted to it at the moment of its exportation. A drawback is perfectly just and reasonable. It leaves the national producer, in the foreign market, on a footing of equality with all his rivals, whilst, if beforehand be had paid a tax in his own country, he could not have sustained the competition. Bounties are the strangest encouragements which a government can give. They may be justified when granted for the fabrication of an article, the production of which it is necessary to procure at any price: but when granted on exported goods, as often happens, government pays merchants, at the expense of its own subjects, that foreigners may buy cheaper than them.
