MORAL, POLITICAL, AND LITERARY
Published in 1752a
[under the title of Political Discourses]
Part II, Essay I
THE greater part of mankind may be divided into two classes; that of shallow thinkers, who fall short of the truth; and that of abstruse thinkers, who go beyond it. The latter class are by far the most rare: and I may add, by far the most useful and valuable. They suggest hints, at least, and start difficulties, which they want, perhaps, skill to pursue; but which may produce fine discoveries, when handled by men who have a more just way of thinking. At worst, what they say is uncommon; and if it should cost some pains to comprehend it, one has, however, the pleasure of hearing something that is new. An author is little to be valued, who tells us nothing but what we can learn from every coffee-house conversation.
All people of shallow thought are apt to decry even those of solid understanding, as abstruse thinkers, and metaphysicians, and refiners; and never will allow any thing to be just which is beyond their own weak conceptions. There are some cases, I own, where an extraordinary refinement affords a strong presumption of falsehood, and where no reasoning is to be trusted but what is natural and easy. When a man deliberates concerning his conduct in any particular affair, and forms schemes in politics, trade, œconomy, or any business in life, he never ought to draw his arguments too fine, or connect too long a chain of consequences together. Something is sure to happen, that will disconcert his reasoning, and produce an event different from what he expected. But when we reason upon general subjects, one may justly affirm, that our speculations can scarcely ever be too fine, provided they be just; and that the difference between a common man and a man of genius is chiefly seen in the shallowness or depth of the principles upon which they proceed. General reasonings seem intricate, merely because they are general; nor is it easy for the bulk of mankind to distinguish, in a great number of particulars, that common circumstance in which they all agree, or to extract it, pure and unmixed, from the other superfluous circumstances. Every judgment or conclusion, with them, is particular. They cannot enlarge their view to those universal propositions, which comprehend under them an infinite number of individuals, and include a whole science in a single theorem. Their eye is confounded with such an extensive prospect; and the conclusions, derived from it, even though clearly expressed, seem intricate and obscure. But however intricate they may seem, it is certain, that general principles, if just and sound, must always prevail in the general course of things, though they may fail in particular cases; and it is the chief business of philosophers to regard the general course of things. I may add, that it is also the chief business of politicians; especially in the domestic government of the state, where the public good, which is, or ought to be their object, depends on the concurrence of a multitude of causes; not, as in foreign politics, on accidents and chances, and the caprices of a few persons. This therefore makes the difference between particular deliberations and general reasonings, and renders subtilty and refinement much more suitable to the latter than to the former.
I thought this introduction necessary before the following discourses on commerce, money, interest, balance of trade, &c.a where, perhaps, there will occur some principles which are uncommon, and which may seem too refined and subtile for such vulgar subjects. If false, let them be rejected: But no one ought to entertain a prejudice against them, merely because they are out of the common road.
The greatness of a state, and the happiness of its subjects, how independent soever they may be supposed in some respects, are commonly allowed to be inseparable with regard to commerce; and as private men receive greater security, in the possession of their trade and riches, from the power of the public, so the public becomes powerful in proportion to the opulence and extensive commerce of private men. This maxim is true in general; though I cannot forbear thinking, that it may possibly admit of exceptions, and that we often establish it with too little reserve and limitation. There may be some circumstances, where the commerce and riches and luxury of individuals, instead of adding strength to the public, will serve only to thin its armies, and diminish its authority among the neighbouring nations. Man is a very variable being, and susceptible of many different opinions, principles, and rules of conduct. What may be true, while he adheres to one way of thinking, will be found false, when he has embraced an opposite set of manners and opinions.
The bulk of every state may be divided into husbandmen and manufacturers. The former are employed in the culture of the land; the latter work up the materials furnished by the former, into all the commodities which are necessary or ornamental to human life. As soon as men quit their savage state, where they live chiefly by hunting and fishing, they must fall into these two classes; though the arts of agriculture employ at first the most numerous part of the society. Time and experience improve so much these arts, that the land may easily maintain a much greater number of men, than those who are immediately employed in its culture, or who furnish the more necessary manufactures to such as are so employed.
If these superfluous hands apply themselves to the finer arts, which are commonly denominated the arts of luxury, they add to the happiness of the state; since they afford to many the opportunity of receiving enjoyments, with which they would otherwise have been unacquainted. But may not another scheme be proposed for the employment of these superfluous hands? May not the sovereign lay claim to them, and employ them in fleets and armies, to encrease the dominions of the state abroad, and spread its fame over distant nations? It is certain that the fewer desires and wants are found in the proprietors and labourers of land, the fewer hands do they employ; and consequently the superfluities of the land, instead of maintaining tradesmen and manufacturers, may support fleets and armies to a much greater extent, than where a great many arts are required to minister to the luxury of particular persons. Here therefore seems to be a kind of opposition between the greatness of the state and the happiness of the subject. A state is never greater than when all its superfluous hands are employed in the service of the public. The ease and convenience of private persons require, that these hands should be employed in their service. The one can never be satisfied, but at the expence of the other. As the ambition of the sovereign must entrench on° the luxury of individuals; so the luxury of individuals must diminish the force, and check the ambition of the sovereign.
Nor is this reasoning merely chimerical; but is founded on history and experience. The republic of SPARTA was certainly more powerful than any state now in the world, consisting of an equal number of people; and this was owing entirely to the want of commerce and luxury. The HELOTES were the labourers: The SPARTANS were the soldiers or gentlemen. It is evident, that the labour of the HELOTES could not have maintained so great a number of SPARTANS, had these latter lived in ease and delicacy, and given employment to a great variety of trades and manufactures. The like policy may be remarked in ROME. And indeed, throughout all ancient history, it is observable, that the smallest republics raised and maintained greater armies, than states consisting of triple the number of inhabitants, are able to support at present. It is computed, that, in all EUROPEAN nations, the proportion between soldiers and people does not exceed one to a hundred. But we read, that the city of ROME alone, with its small territory, raised and maintained, in early times, ten legions against the LATINS. ATHENS, the whole of whose dominions was not larger than YORKSHIRE, sent to the expedition against SICILY near forty thousand men. DIONYSIUS the elder, it is said, maintained a standing army of a hundred thousand foot and ten thousand horse, besides a large fleet of four hundred sail; though his territories extended no farther than the city of SYRACUSE, about a third of the island of SICILY, and some sea-port towns and garrisons on the coast of ITALY and ILLYRICUM. It is true, the ancient armies, in time of war, subsisted much upon plunder: But did not the enemy plunder in their turn? which was a more ruinous way of levying a tax, than any other that could be devised. In short, no probable reason can be assigned for the great power of the more ancient states above the modern, but their want of commerce and luxury. Few artizans were maintained by the labour of the farmers, and therefore more soldiers might live upon it. LIVY says, that ROME, in his time, would find it difficult to raise as large an army as that which, in her early days, she sent out against the GAULS and LATINS. Instead of those soldiers who fought for liberty and empire in CAMILLUS'S time, there were, in AUGUSTUS'S days, musicians, painters, cooks, players, and tailors; and if the land was equally cultivated at both periods, it could certainly maintain equal numbers in the one profession as in the other. They added nothing to the mere necessaries of life, in the latter period more than in the former.
It is natural on this occasion to ask, whether sovereigns may not return to the maxims of ancient policy, and consult their own interest in this respect, more than the happiness of their subjects? I answer, that it appears to me, almost impossible; and that because ancient policy was violent, and contrary to the more natural and usual course of things. It is well known with what peculiar laws SPARTA was governed, and what a prodigy that republic is justly esteemed by every one, who has considered human nature as it has displayed itself in other nations, and other ages. Were the testimony of history less positive and circumstantial,° such a government would appear a mere philosophical whim or fiction, and impossible ever to be reduced to practice. And though the ROMAN and other ancient republics were supported on principles somewhat more natural, yet was there an extraordinary concurrence of circumstances to make them submit to such grievous burthens.° They were free states; they were small ones; and the age being martial, all their neighbours were continually in arms. Freedom naturally begets public spirit, especially in small states; and this public spirit, this amor patriæ,° must encrease, when the public is almost in continual alarm, and men are obliged, every moment, to expose themselves to the greatest dangers for its defence. A continual succession of wars makes every citizen a soldier: He takes the field in his turn: And during his service he is chiefly maintained by himself. This service is indeed equivalent to a heavy tax; yet is it less felt by a people addicted to arms, who fight for honour and revenge more than pay, and are unacquainted with gain and industry as well as pleasure. Not to mention the great equality of fortunes among the inhabitants of the ancient republics, where every field, belonging to a different proprietor, was able to maintain a family, and rendered the numbers of citizens very considerable, even without trade and manufactures.
But though the want of trade and manufactures, among a free and very martial people, may sometimes have no other effect than to render the public more powerful, it is certain, that, in the common course of human affairs, it will have a quite contrary tendency. Sovereigns must take mankind as they find them, and cannot pretend to introduce any violent change in their principles and ways of thinking. A long course of time, with a variety of accidents and circumstances, are requisite to produce those great revolutions, which so much diversify the face of human affairs. And the less natural any set of principles are, which support a particular society, the more difficulty will a legislator meet with in raising and cultivating them. It is his best policy to comply with the common bent of mankind, and give it all the improvements of which it is susceptible. Now, according to the most natural course of things, industry and arts and trade encrease the power of the sovereign as well as the happiness of the subjects; and that policy is violent, which aggrandizes the public by the poverty of individuals. This will easily appear from a few considerations, which will present to us the consequences of sloth and barbarity.
Where manufactures and mechanic arts are not cultivated, the bulk of the people must apply themselves to agriculture; and if their skill and industry encrease, there must arise a great superfluity from their labour beyond what suffices to maintain them. They have no temptation, therefore, to encrease their skill and industry; since they cannot exchange that superfluity for any commodities, which may serve either to their pleasure or vanity. A habit of indolence naturally prevails. The greater part of the land lies uncultivated. What is cultivated, yields not its utmost for want of skill and assiduity in the farmers. If at any time the public exigencies require, that great numbers should be employed in the public service, the labour of the people furnishes now no superfluities, by which these numbers can be maintained. The labourers cannot encrease their skill and industry on a sudden.° Lands uncultivated cannot be brought into tillage for some years. The armies, mean while, must either make sudden and violent conquests, or disband for want of subsistence. A regular attack or defence, therefore, is not to be expected from such a people, and their soldiers must be as ignorant and unskilful as their farmers and manufacturers.
Every thing in the world is purchased by labour; and our passions are the only causes of labour. When a nation abounds in manufactures and mechanic arts, the proprietors of land, as well as the farmers, study agriculture as a science, and redouble their industry and attention. The superfluity, which arises from their labour, is not lost; but is exchanged with manufactures for those commodities, which men's luxury now makes them covet. By this means, land furnishes a great deal more of the necessaries of life, than what suffices for those who cultivate it. In times of peace and tranquillity, this superfluity goes to the maintenance of manufacturers, and the improvers of liberal arts. But it is easy for the public to convert many of these manufacturers into soldiers, and maintain them by that superfluity, which arises from the labour of the farmers. Accordingly we find, that this is the case in all civilized governments. When the sovereign raises an army, what is the consequence? He imposes a tax. This tax obliges all the people to retrench° what is least necessary to their subsistence. Those, who labour in such commodities, must either enlist in the troops, or turn themselves to agriculture, and thereby oblige some labourers to enlist for want of business. And to consider the matter abstractedly, manufactures encrease the power of the state only as they store up so much labour, and that of a kind to which the public may lay claim, without depriving any one of the necessaries of life. The more labour, therefore, is employed beyond mere necessaries, the more powerful is any state; since the persons engaged in that labour may easily be converted to the public service. In a state without manufactures, there may be the same number of hands; but there is not the same quantity of labour, nor of the same kind. All the labour is there bestowed upon necessaries, which can admit of little or no abatement.°
Thus the greatness of the sovereign and the happiness of the state are, in a great measure, united with regard to trade and manufactures. It is a violent method, and in most cases impracticable, to oblige the labourer to toil, in order to raise from the land more than what subsists himself and family. Furnish him with manufactures and commodities, and he will do it of himself. Afterwards you will find it easy to seize some part of his superfluous labour, and employ it in the public service, without giving him his wonted° return. Being accustomed to industry, he will think this less grievous, than if, at once, you obliged him to an augmentation of labour without any reward. The case is the same with regard to the other members of the state. The greater is the stock of labour of all kinds, the greater quantity may be taken from the heap, without making any sensible alteration in it.
A public granary of corn, a storehouse of cloth, a magazine of arms; all these must be allowed real riches and strength in any state. Trade and industry are really nothing but a stock of labour, which, in times of peace and tranquillity, is employed for the ease and satisfaction of individuals; but in the exigencies of state, may, in part, be turned to public advantage. Could we convert a city into a kind of fortified camp, and infuse into each breast so martial a genius, and such a passion for public good, as to make every one willing to undergo the greatest hardships for the sake of the public; these affections might now, as in ancient times, prove alone a sufficient spur to industry, and support the community. It would then be advantageous, as in camps, to banish all arts and luxury; and, by restrictions on equipage and tables, make the provisions and forage last longer than if the army were loaded with a number of superfluous retainers. But as these principles are too disinterested and too difficult to support, it is requisite to govern men by other passions, and animate them with a spirit of avarice and industry, art and luxury. The camp is, in this case, loaded with a superfluous retinue; but the provisions flow in proportionably larger. The harmony of the whole is still supported; and the natural bent of the mind being more complied with, individuals, as well as the public, find their account in the observance of those maxims.
The same method of reasoning will let us see the advantage of foreign commerce, in augmenting the power of the state, as well as the riches and happiness of the subject. It encreases the stock of labour in the nation; and the sovereign may convert what share of it he finds necessary to the service of the public. Foreign trade, by its imports, furnishes materials for new manufactures; and by its exports, it produces labour in particular commodities, which could not be consumed at home. In short, a kingdom, that has a large import and export, must abound more with industry, and that employed upon delicacies and luxuries, than a kingdom which rests contented with its native commodities. It is, therefore, more powerful, as well as richer and happier. The individuals reap the benefit of these commodities, so far as they gratify the senses and appetites. And the public is also a gainer, while a greater stock of labour is, by this means, stored up against any public exigency; that is, a greater number of laborious men are maintained, who may be diverted to the public service, without robbing any one of the necessaries, or even the chief conveniencies of life.
If we consult history, we shall find, that, in most nations, foreign trade has preceded any refinement in home manufactures, and given birth to domestic luxury. The temptation is stronger to make use of foreign commodities, which are ready for use, and which are entirely new to us, than to make improvements on any domestic commodity, which always advance by slow degrees, and never affect us by their novelty. The profit is also very great, in exporting what is superfluous at home, and what bears no price, to foreign nations, whose soil or climate is not favourable to that commodity. Thus men become acquainted with the pleasures of luxury and the profits of commerce; and their delicacy and industry, being once awakened, carry them on to farther improvements, in every branch of domestic as well as foreign trade. And this perhaps is the chief advantage which arises from a commerce with strangers. It rouses men from their indolence; and presenting the gayer and more opulent part of the nation with objects of luxury, which they never before dreamed of, raises in them a desire of a more splendid way of life than what their ancestors enjoyed. And at the same time, the few merchants, who possess the secret of this importation and exportation, make great profits; and becoming rivals in wealth to the ancient nobility, tempt other adventurers to become their rivals in commerce. Imitation soon diffuses all those arts; while domestic manufactures emulate the foreign in their improvements, and work up every home commodity to the utmost perfection of which it is susceptible. Their own steel and iron, in such laborious hands, become equal to the gold and rubies of the INDIES.
When the affairs of the society are once brought to this situation, a nation may lose most of its foreign trade, and yet continue a great and powerful people. If strangers will not take any particular commodity of ours, we must cease to labour in it. The same hands will turn themselves towards some refinement in other commodities, which may be wanted at home. And there must always be materials for them to work upon; till every person in the state, who possesses riches, enjoys as great plenty of home commodities, and those in as great perfection, as he desires; which can never possibly happen. CHINA is represented as one of the most flourishing empires in the world; though it has very little commerce beyond its own territories.
It will not, I hope, be considered as a superfluous digression, if I here observe, that, as the multitude of mechanical arts is advantageous, so is the great number of persons to whose share the productions of these arts fall. A too great disproportion among the citizens weakens any state. Every person, if possible, ought to enjoy the fruits of his labour, in a full possession of all the necessaries, and many of the conveniencies of life. No one can doubt, but such an equality is most suitable to human nature, and diminishes much less from the happiness of the rich than it adds to that of the poor. It also augments the power of the state, and makes any extraordinary taxes or impositions be paid with more chearfulness. Where the riches are engrossed° by a few, these must contribute very largely to the supplying of the public necessities. But when the riches are dispersed among multitudes, the burthen feels light on every shoulder, and the taxes make not a very sensible difference on any one's way of living.
Add to this, that, where the riches are in few hands, these must enjoy all the power, and will readily conspire to lay the whole burthen on the poor, and oppress them still farther, to the discouragement of all industry.
In this circumstance consists the great advantage of ENGLAND above any nation at present in the world, or that appears in the records of any story. It is true, the ENGLISH feel some disadvantages in foreign trade by the high price of labour, which is in part the effect of the riches of their artisans, as well as of the plenty of money: But as foreign trade is not the most material circumstance, it is not to be put in competition with the happiness of so many millions. And if there were no more to endear to them that free government under which they live, this alone were sufficient. The poverty of the common people is a natural, if not an infallible effect of absolute monarchy; though I doubt, whether it be always true, on the other hand, that their riches are an infallible result of liberty. Liberty must be attended with particular accidents, and a certain turn of thinking, in order to produce that effect. Lord BACON, accounting for the great advantages obtained by the ENGLISH in their wars with FRANCE, ascribes them chiefly to the superior ease and plenty of the common people amongst the former; yet the government of the two kingdoms was, at that time, pretty much alike. Where the labourers and artisans are accustomed to work for low wages, and to retain but a small part of the fruits of their labour, it is difficult for them, even in a free government, to better their condition, or conspire among themselves to heighten their wages. But even where they are accustomed to a more plentiful way of life, it is easy for the rich, in an arbitrary government, to conspire against them, and throw the whole burthen of the taxes on their shoulders.
It may seem an odd position, that the poverty of the common people in FRANCE, ITALY, and SPAIN, is, in some measure, owing to the superior riches of the soil and happiness of the climate; yet there want not reasons to justify this paradox. In such a fine mould or soil as that of those more southern regions, agriculture is an easy art; and one man, with a couple of sorry° horses, will be able, in a season, to cultivate as much land as will pay a pretty considerable rent to the proprietor. All the art, which the farmer knows, is to leave his ground fallow° for a year, as soon as it is exhausted; and the warmth of the sun alone and temperature of the climate enrich it, and restore its fertility. Such poor peasants, therefore, require only a simple maintenance for their labour. They have no stock or riches, which claim more; and at the same time, they are for ever dependant on their landlord, who gives no leases, nor fears that his land will be spoiled by the ill methods of cultivation. In ENGLAND, the land is rich, but coarse; must be cultivated at a great expence; and produces slender crops, when not carefully managed, and by a method which gives not the full profit but in a course of several years. A farmer, therefore, in ENGLAND must have a considerable stock, and a long lease; which beget proportional profits. The fine vineyards of CHAMPAGNE and BURGUNDY, that often yield to the landlord above five pounds per acre, are cultivated by peasants, who have scarcely bread: The reason is, that such peasants need no stock but their own limbs, with instruments of husbandry, which they can buy for twenty shillings. The farmers are commonly in some better circumstances in those countries. But the grasiers° are most at their ease of all those who cultivate the land. The reason is still the same. Men must have profits proportionable to their expence and hazard. Where so considerable a number of the labouring poor as the peasants and farmers are in very low circumstances, all the rest must partake of their poverty, whether the government of that nation be monarchical or republican.
We may form a similar remark with regard to the general history of mankind. What is the reason, why no people, living between the tropics, could ever yet attain to any art or civility, or reach even any police° in their government, and any military discipline; while few nations in the temperate climates have been altogether deprived of these advantages? It is probable that one cause of this phænomenon is the warmth and equality of weather in the torrid zone, which render clothes and houses less requisite for the inhabitants, and thereby remove, in part, that necessity, which is the great spur to industry and invention. Curis acuens mortalia corda. Not to mention, that the fewer goods or possessions of this kind any people enjoy, the fewer quarrels are likely to arise amongst them, and the less necessity will there be for a settled police or regular authority to protect and defend them from foreign enemies, or from each other.
Notes for this chapter
[The editions from 1752 to 1768 read "cases" rather than "causes." See Eugene Rotwein, David Hume: Writings on Economics (Madison: University of Wisconsin Press, 1955), p. 4. Hume's point here is that general principles can be established concerning domestic politics and commercial or economic affairs because one finds regularities of behavior in these areas of life. These regularities arise from two principal causes: the institutions of government and the human passions. As Hume has observed earlier, there can be a science of politics because laws and forms of government shape human actions in a uniform way (see above, p. 16). Moreover, domestic politics, and commerce in particular, arise from the more universal passions, which tend to operate "at all times, in all places, and upon all persons" (p. 113).]
Mons. MELON, in his political essay on commerce, asserts, that even at present, if you divide FRANCE into 20 parts, 16 are labourers or peasants; two only artizans; one belonging to the law, church, and military; and one merchants, financiers, and bourgeois. This calculation is certainly very erroneous. In FRANCE, ENGLAND, and indeed most parts of EUROPE, half of the inhabitants live in cities; and even of those who live in the country, a great number are artizans, perhaps above a third. [Jean-François Melon (1675?-1738), Essai politique sur le commerce (1734; expanded 2d ed., 1736; translated ed., A Political Essay Upon Commerce, 1738).]
[See Livy, History of Rome 8.25.]
THUCYDIDES, lib. vii. [75.]
DIOD. SIC. lib. vii. [See 2.5 in the Loeb edition.] This account, I own, is somewhat suspicious, not to say worse; chiefly because this army was not composed of citizens, but of mercenary forces.
[Illyricum refers generally to an area along the Adriatic Sea in present-day Yugoslavia.]
TITI LIVII, lib. vii. cap. 24. "Adeo in quæ laboramus," says he, "sola crevimus, divitias luxuriemque." [Livy, History of Rome 7.25: "... so strictly has our growth been limited to the only things for which we strive,—wealth and luxury" (Loeb translation by B. O. Foster). Livy is writing of Rome in 348 B.C., when Camillus was dictator.]
The more ancient ROMANS lived in perpetual war with all their neighbours: And in old LATIN, the term hostis, expressed both a stranger and an enemy. This is remarked by CICERO; but by him is ascribed to the humanity of his ancestors, who softened, as much as possible, the denomination of an enemy, by calling him by the same appellation which signified a stranger. De Off. lib. ii. [1.12 in the Loeb edition.] It is however much more probable, from the manners of the times, that the ferocity of those people was so great as to make them regard all strangers as enemies, and call them by the same name. It is not, besides, consistent with the most common maxims of policy or of nature, that any state should regard its public enemies with a friendly eye, or preserve any such sentiments for them as the ROMAN orator would ascribe to his ancestors. Not to mention, that the early ROMANS really exercised piracy, as we learn from their first treaties with CARTHAGE, preserved by POLYBIUS, lib. iii. and consequently, like the SALLEE and ALGERINE rovers, were actually at war with most nations, and a stranger and an enemy were with them almost synonimous. [The Sallee and Algerine rovers were pirates who operated from the Barbary Coast of North Africa.]
[See Bacon's Essays, 29: "Of the true greatness of Kingdoms and Estates."]
[French provinces celebrated for their wines.]
Part II, Essay II
End of Notes
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Part II, Essay V
OF THE BALANCE OF TRADE
IT is very usual, in nations ignorant of the nature of commerce, to prohibit the exportation of commodities, and to preserve among themselves whatever they think valuable and useful. They do not consider, that, in this prohibition, they act directly contrary to their intention; and that the more is exported of any commodity, the more will be raised at home, of which they themselves will always have the first offer.°
It is well known to the learned, that the ancient laws of ATHENS rendered the exportation of figs criminal; that being supposed a species of fruit so excellent in ATTICA, that the ATHENIANS deemed it too delicious for the palate of any foreigner. And in this ridiculous prohibition they were so much in earnest, that informers were thence called sycophants among them, from two GREEK words, which signify figs and discoverer. , a There are proofs in many old acts of parliament of the same ignorance in the nature of commerce, particularly in the reign of EDWARD III. And to this day, in FRANCE, the exportation of corn is almost always prohibited; in order, as they say, to prevent famines; though it is evident, that nothing contributes more to the frequent famines, which so much distress that fertile country.
The same jealous fear, with regard to money, has also prevailed among several nations; and it required both reason and experience to convince any people, that these prohibitions serve to no other purpose than to raise the exchange against them, and produce a still greater exportation.
These errors, one may say, are gross and palpable: But there still prevails, even in nations well acquainted with commerce, a strong jealousy with regard to the balance of trade, and a fear, that all their gold and silver may be leaving them. This seems to me, almost in every case, a groundless apprehension; and I should as soon dread, that all our springs and rivers should be exhausted, as that money should abandon a kingdom where there are people and industry. Let us carefully preserve these latter advantages; and we need never be apprehensive of losing the former.
It is easy to observe, that all calculations concerning the balance of trade are founded on very uncertain facts and suppositions. The custom-house books are allowed to be an insufficient ground of reasoning; nor is the rate of exchange much better; unless we consider it with all nations, and know also the proportions of the several sums remitted; which one may safely pronounce impossible. Every man, who has ever reasoned on this subject, has always proved his theory, whatever it was, by facts and calculations, and by an enumeration of all the commodities sent to all foreign kingdoms.
The writings of Mr. GEE struck the nation with an universal panic, when they saw it plainly demonstrated, by a detail of particulars, that the balance was against them for so considerable a sum as must leave them without a single shilling in five or six years. But luckily, twenty years have since elapsed, with an expensive foreign war; yet is it commonly supposed, that money is still more plentiful among us than in any former period.
Nothing can be more entertaining on this head than Dr. SWIFT; an authorb so quick in discerning the mistakes and absurdities of others. He says, in his short view of the state of IRELAND, that the whole cash of that kingdom formerly amounted but to 500,000 l.; that out of this the IRISH remitted every year a neat million to ENGLAND, and had scarcely any other source from which they could compensate themselves, and little other foreign trade than the importation of FRENCH wines, for which they paid ready money. The consequence of this situation, which must be owned to be disadvantageous, was, that, in a course of three years, the current money of IRELAND, from 500,000 l. was reduced to less than two. And at present, I suppose, in a course of 30 years it is absolutely nothing. Yet I know not how, that opinion of the advance of riches in IRELAND, which gave the Doctor so much indignation, seems still to continue, and gain ground with every body.
In short, this apprehension of the wrong balance of trade, appears of such a nature, that it discovers itself, wherever one is out of humour with the ministry, or is in low spirits; and as it can never be refuted by a particular detail of all the exports, which counterbalance the imports, it may here be proper to form a general argument, that may prove the impossibility of this event, as long as we preserve our people and our industry.
Suppose four-fifths of all the money in GREAT BRITAIN to be annihilated in one night, and the nation reduced to the same condition, with regard to specie, as in the reigns of the HARRYS and EDWARDS, what would be the consequence? Must not the price of all labour and commodities sink in proportion, and every thing be sold as cheap as they were in those ages? What nation could then dispute with us in any foreign market, or pretend to navigate or to sell manufactures at the same price, which to us would afford sufficient profit? In how little time, therefore, must this bring back the money which we had lost, and raise us to the level of all the neighbouring nations? Where, after we have arrived, we immediately lose the advantage of the cheapness of labour and commodities; and the farther flowing in of money is stopped by our fulness and repletion.°
Again, suppose, that all the money of GREAT BRITAIN were multiplied fivefold in a night, must not the contrary effect follow? Must not all labour and commodities rise to such an exorbitant height, that no neighbouring nations could afford to buy from us; while their commodities, on the other hand, became comparatively so cheap, that, in spite of all the laws which could be formed, they would be run in upon us, and our money flow out; till we fall to a level with foreigners, and lose that great superiority of riches, which had laid us under such disadvantages?
Now, it is evident, that the same causes, which would correct these exorbitant inequalities, were they to happen miraculously, must prevent their happening in the common course of nature, and must for ever, in all neighbouring nations, preserve money nearly proportionable to the art and industry of each nation. All water, wherever it communicates, remains always at a level. Ask naturalists the reason; they tell you, that, were it to be raised in any one place, the superior gravity of that part not being balanced, must depress it, till it meet a counterpoise; and that the same cause, which redresses the inequality when it happens, must for ever prevent it, without some violent external operation.
Can one imagine, that it had ever been possible, by any laws, or even by any art or industry, to have kept all the money in SPAIN, which the galleons have brought from the INDIES? Or that all commodities could be sold in FRANCE for a tenth of the price which they would yield on the other side of the PYRENEES, without finding their way thither, and draining from that immense treasure? What other reason, indeed, is there, why all nations, at present, gain in their trade with SPAIN and PORTUGAL; but because it is impossible to heap up money, more than any fluid, beyond its proper level? The sovereigns of these countries have shown, that they wanted not inclination to keep their gold and silver to themselves, had it been in any degree practicable.
But as any body of water may be raised above the level of the surrounding element, if the former has no communication with the latter; so in money, if the communication be cut off, by any material or physical impediment, (for all laws alone are ineffectual) there may, in such a case, be a very great inequality of money. Thus the immense distance of CHINA, together with the monopolies of our INDIA companies, obstructing the communication, preserve in EUROPE the gold and silver, especially the latter, in much greater plenty than they are found in that kingdom. But, notwithstanding this great obstruction, the force of the causes abovementioned is still evident. The skill and ingenuity of EUROPE in general surpasses perhaps that of CHINA, with regard to manual arts and manufactures; yet are we never able to trade thither without great disadvantage. And were it not for the continual recruits,° which we receive from AMERICA, money would soon sink in EUROPE, and rise in CHINA, till it came nearly to a level in both places. Nor can any reasonable man doubt, but that industrious nation, were they as near us as POLAND or BARBARY, would drain us of the overplus of our specie, and draw to themselves a larger share of the WEST INDIAN treasures. We need not have recourse to a physical attraction, in order to explain the necessity of this operation. There is a moral attraction, arising from the interests and passions of men, which is full as potent and infallible.
How is the balance kept in the provinces of every kingdom among themselves, but by the force of this principle, which makes it impossible for money to lose its level, and either to rise or sink beyond the proportion of the labour and commodities which are in each province? Did not long experience make people easy on this head, what a fund of gloomy reflections might calculations afford to a melancholy YORKSHIREMAN, while he computed and magnified the sums drawn to LONDON by taxes, absentees,° commodities, and found on comparison the opposite articles so much inferior? And no doubt, had the Heptarchy subsisted in ENGLAND, the legislature of each state had been continually alarmed by the fear of a wrong balance; and as it is probable that the mutual hatred of these states would have been extremely violent on account of their close neighbourhood, they would have loaded and oppressed all commerce, by a jealous and superfluous caution. Since the union has removed the barriers between SCOTLAND and ENGLAND, which of these nations gains from the other by this free commerce? Or if the former kingdom has received any encrease of riches, can it reasonably be accounted for by any thing but the encrease of its art and industry? It was a common apprehension in ENGLAND, before the union, as we learn from L'ABBE DU BOS, that SCOTLAND would soon drain them of their treasure, were an open trade allowed; and on the other side the TWEED a contrary apprehension prevailed: With what justice in both, time has shown.
What happens in small portions of mankind, must take place in greater. The provinces of the ROMAN empire, no doubt, kept their balance with each other, and with ITALY, independent of the legislature; as much as the several counties of GREAT BRITAIN, or the several parishes of each county. And any man who travels over EUROPE at this day, may see, by the prices of commodities, that money, in spite of the absurd jealousy of princes and states, has brought itself nearly to a level; and that the difference between one kingdom and another is not greater in this respect, than it is often between different provinces of the same kingdom. Men naturally flock to capital cities, sea-ports, and navigable rivers. There we find more men, more industry, more commodities, and consequently more money; but still the latter difference holds proportion with the former, and the level is preserved.
Our jealousy and our hatred of FRANCE are without bounds; and the former sentiment, at least, must be acknowledged reasonable and well-grounded. These passions have occasioned innumerable barriers and obstructions upon commerce, where we are accused of being commonly the aggressors. But what have we gained by the bargain? We lost the FRENCH market for our woollen manufactures, and transferred the commerce of wine to SPAIN and PORTUGAL, where we buy worse liquor at a higher price. There are few ENGLISHMEN who would not think their country absolutely ruined, were FRENCH wines sold in ENGLAND so cheap and in such abundance as to supplant, in some measure, all ale, and home-brewed liquors: But would we lay aside prejudice, it would not be difficult to prove, that nothing could be more innocent, perhaps advantageous. Each new acre of vineyard planted in FRANCE, in order to supply ENGLAND with wine, would make it requisite for the FRENCH to take the produce of an ENGLISH acre, sown in wheat or barley, in order to subsist themselves; and it is evident, that we should thereby get command of the better commodity.
There are many edicts of the FRENCH king, prohibiting the planting of new vineyards, and ordering all those which are lately planted to be grubbed up: So sensible are they, in that country, of the superior value of corn, above every other product.
Mareschal VAUBAN complains often, and with reason, of the absurd duties which load the entry of those wines of LANGUEDOC, GUIENNE, and other southern provinces, that are imported into BRITANNY and NORMANDY. He entertained no doubt but these latter provinces could preserve their balance, notwithstanding the open commerce which he recommends. And it is evident, that a few leagues more navigation to ENGLAND would make no difference; or if it did, that it must operate alike on the commodities of both kingdoms.
There is indeed one expedient by which it is possible to sink, and another by which we may raise money beyond its natural level in any kingdom; but these cases, when examined, will be found to resolve into our general theory, and to bring additional authority to it.
I scarcely know any method of sinking money below its level, but those institutions of banks, funds, and paper-credit, cwhich are so much practised in this kingdom. These render paper equivalent to money, circulate it throughout the whole state, make it supply the place of gold and silver, raise proportionably the price of labour and commodities, and by that means either banish a great part of those precious metals, or prevent their farther encrease. What can be more shortsighted than our reasonings on this head? We fancy, because an individual would be much richer, were his stock of money doubled, that the same good effect would follow were the money of every one encreased; not considering, that this would raise as much the price of every commodity, and reduce every man, in time, to the same condition as before. It is only in our public negociations and transactions with foreigners, that a greater stock of money is advantageous; and as our paper is there absolutely insignificant, we feel, by its means, all the ill effects arising from a great abundance of money, without reaping any of the advantages.
Suppose that there are 12 millions of paper, which circulate in the kingdom as money, (for we are not to imagine, that all our enormous funds are employed in that shape) and suppose the real cash of the kingdom to be 18 millions: Here is a state which is found by experience to be able to hold a stock of 30 millions. I say, if it be able to hold it, it must of necessity have acquired it in gold and silver, had we not obstructed the entrance of these metals by this new invention of paper. Whence would it have acquired that sum? From all the kingdoms of the world. But why? Because, if you remove these 12 millions, money in this state is below its level, compared with our neighbours; and we must immediately draw from all of them, till we be full and saturate, so to speak, and can hold no more. By our present politics, we are as careful to stuff the nation with this fine commodity of bank-bills and chequer-notes, as if we were afraid of being overburthened with the precious metals.
It is not to be doubted, but the great plenty of bullion in FRANCE is, in a great measure, owing to the want of paper-credit. The FRENCH have no banks: Merchants bills do not there circulate as with us: Usury or lending on interest is not directly permitted; so that many have large sums in their coffers: Great quantities of plate° are used in private houses; and all the churches are full of it. By this means, provisions and labour still remain cheaper among them, than in nations that are not half so rich in gold and silver. The advantages of this situation, in point of trade as well as in great public emergencies, are too evident to be disputed.
The same fashion a few years ago prevailed in GENOA, which still has place in ENGLAND and HOLLAND, of using services of CHINA-ware instead of plate; but the senate, foreseeing the consequence, prohibited the use of that brittle commodity beyond a certain extent; while the use of silver-plate was left unlimited. And I suppose, in their late distresses, they felt the good effect of this ordinance. Our tax on plate is, perhaps, in this view, somewhat impolitic.
Before the introduction of paper-money into our colonies, they had gold and silver sufficient for their circulation. Since the introduction of that commodity, the least inconveniency that has followed is the total banishment of the precious metals. And after the abolition of paper, can it be doubted but money will return, while these colonies possess manufactures and commodities, the only thing valuable in commerce, and for whose sake alone all men desire money.
What pity LYCURGUS did not think of paper-credit, when he wanted to banish gold and silver from SPARTA! It would have served his purpose better than the lumps of iron he made use of as money; and would also have prevented more effectually all commerce with strangers, as being of so much less real and intrinsic value.
dIt must, however, be confessed, that, as all these questions of trade and money are extremely complicated, there are certain lights, in which this subject may be placed, so as to represent the advantages of paper-credit and banks to be superior to their disadvantages. That they banish specie and bullion from a state is undoubtedly true; and whoever looks no farther than this circumstance does well to condemn them; but specie and bullion are not of so great consequence as not to admit of a compensation, and even an overbalance from the encrease of industry and of credit, which may be promoted by the right use of paper-money. It is well known of what advantage it is to a merchant to be able to discount his bills upon occasion; and every thing that facilitates this species of traffic is favourable to the general commerce of a state. But private bankers are enabled to give such credit by the credit they receive from the depositing of money in their shops; and the bank of ENGLAND in the same manner, from the liberty it has to issue its notes in all payments. There was an invention of this kind, which was fallen upon some years ago by the banks of EDINBURGH; and which, as it is one of the most ingenious ideas that has been executed in commerce, has also been thought advantageous to SCOTLAND. It is there called a BANK-CREDIT; and is of this nature. A man goes to the bank and finds surety° to the amount, we shall suppose, of a thousand pounds. This money, or any part of it, he has the liberty of drawing out whenever he pleases, and he pays only the ordinary interest for it, while it is in his hands. He may, when he pleases, repay any sum so small as twenty pounds, and the interest is discounted from the very day of the repayment. The advantages, resulting from this contrivance, are manifold. As a man may find surety nearly to the amount of his substance, and his bank-credit is equivalent to ready money, a merchant does hereby in a manner coin his houses, his household furniture, the goods in his warehouse, the foreign debts due to him, his ships at sea; and can, upon occasion, employ them in all payments, as if they were the current money of the country. If a man borrow a thousand pounds from a private hand, besides that it is not always to be found when required, he pays interest for it, whether he be using it or not: His bank-credit costs him nothing except during the very moment, in which it is of service to him: And this circumstance is of equal advantage as if he had borrowed money at much lower interest. Merchants, likewise, from this invention, acquire a great facility in supporting each other's credit, which is a considerable security against bankruptcies. A man, when his own bank-credit is exhausted, goes to any of his neighbours who is not in the same condition; and he gets the money, which he replaces at his convenience.
eAfter this practice had taken place during some years at EDINBURGH, several companies of merchants at GLASGOW carried the matter farther. They associated themselves into different banks, and issued notes so low as ten shillings, which they used in all payments for goods, manufactures, tradesmen's labour of all kinds; and these notes, from the established credit of the companies, passed as money in all payments throughout the country. By this means, a stock of five thousand pounds was able to perform the same operations as if it were six or seven; and merchants were thereby enabled to trade to a greater extent, and to require less profit in all their transactions. But whatever other advantages result from these inventions, it must still be allowed that, besides giving too great facility to credit, which is dangerous, they banish the precious metals; and nothing can be a more evident proof of it, than a comparison of the past and present condition of SCOTLAND in that particular. It was found, upon the recoinage made after the union, that there was near a million of specie in that country: But notwithstanding the great encrease of riches, commerce and manufactures of all kinds, it is thought, that, even where there is no extraordinary drain made by ENGLAND, the current specie will not now amount to a third of that sum.
fBut as our projects of paper-credit are almost the only expedient, by which we can sink money below its level; so, in my opinion, the only expedient, by which we can raise money above it, is a practice which we should all exclaim against as destructive, namely, the gathering of large sums into a public treasure, locking them up, and absolutely preventing their circulation. The fluid, not communicating with the neighbouring element, may, by such an artifice, be raised to what height we please. To prove this, we need only return to our first supposition, of annihilating the half or any part of our cash; where we found, that the immediate consequence of such an event would be the attraction of an equal sum from all the neighbouring kingdoms. Nor does there seem to be any necessary bounds set, by the nature of things, to this practice of hoarding. A small city, like GENEVA, continuing this policy for ages, might engross nine-tenths of the money of EUROPE. There seems, indeed, in the nature of man, an invincible obstacle to that immense growth of riches. A weak state, with an enormous treasure, will soon become a prey to some of its poorer, but more powerful neighbours. A great state would dissipate its wealth in dangerous and ill-concerted projects; and probably destroy, with it, what is much more valuable, the industry, morals, and numbers of its people. The fluid, in this case, raised to too great a height, bursts and destroys the vessel that contains it; and mixing itself with the surrounding element, soon falls to its proper level.
So little are we commonly acquainted with this principle, that, though all historians agree in relating uniformly so recent an event, as the immense treasure amassed by HARRY VII. (which they make amount to g2,700,000 pounds,) we rather reject their concurring testimony, than admit of a fact, which agrees so ill with our inveterate prejudices. It is indeed probable, that this sum might be three-fourths of all the money in ENGLAND. But where is the difficulty in conceiving, that such a sum might be amassed in twenty years, by a cunning, rapacious, frugal, and almost absolute monarch? Nor is it probable, that the diminution of circulating money was ever sensibly felt by the people, or ever did them any prejudice. The sinking of the prices of all commodities would immediately replace it, by giving ENGLAND the advantage in its commerce with the neighbouring kingdoms.
Have we not an instance, in the small republic of ATHENS with its allies, who, in about fifty years, between the MEDIAN and PELOPONNESIAN wars, amassed ha sum not much inferior to that of HARRY VII.? For all the GREEK historians and orators agree, that the ATHENIANS collected in the citadel more than 10,000 talents, which they afterwards dissipated to their own ruin, in rash and imprudent enterprizes. But when this money was set a running, and began to communicate with the surrounding fluid; what was the consequence? Did it remain in the state? No. For we find, by the memorable census mentioned by DEMOSTHENES and POLYBIUS, that, in about fifty years afterwards, the whole value of the republic, comprehending lands, houses, commodities, slaves, and money, was less than 6000 talents.
What an ambitious high-spirited people was this, to collect and keep in their treasury, with a view to conquests, a sum, which it was every day in the power of the citizens, by a single vote, to distribute among themselves, and which would have gone near to triple the riches of every individual! For we must observe, that the numbers and private riches of the ATHENIANS are said, by ancient writers, to have been no greater at the beginning of the PELOPONNESIAN war, than at the beginning of the MACEDONIAN.
Money was little more plentiful in GREECE during the age of PHILIP and PERSEUS, than in ENGLAND during that of HARRY VII.: Yet these two monarchs in thirty years collected from the small kingdom of MACEDON, a larger treasure than that of the ENGLISH monarch. PAULUS ÆMILIUS brought to ROME about 1,700,000 pounds Sterling. PLINY says, 2,400,000. And that was but a part of the MACEDONIAN treasure. The rest was dissipated by the resistance and flight of PERSEUS.
We may learn from STANIAN, that the canton of BERNE had 300,000 pounds lent at interest, and had above six times as much in their treasury. Here then is a sum hoarded of 1,800,000 pounds Sterling, which is at least quadruple what should naturally circulate in such a petty state; and yet no one, who travels in the PAIS DE VAUX, or any part of that canton, observes any want of money more than could be supposed in a country of that extent, soil, and situation. On the contrary, there are scarce any inland provinces in the continent of FRANCE or GERMANY, where the inhabitants are at this time so opulent, though that canton has vastly encreased its treasure since 1714, the time when STANIAN wrote his judicious account of SWITZERLAND.
The account given by APPIAN of the treasure of the PTOLEMIES, is so prodigious, that one cannot admit of it; and so much the less, because the historian says, that the other successors of ALEXANDER were also frugal, and had many of them treasures not much inferior. For this saving humour of the neighbouring princes must necessarily have checked the frugality of the EGYPTIAN monarchs, according to the foregoing theory. The sum he mentions is 740,000 talents, or 191,166,666 pounds 13 shillings and 4 pence, according to Dr. ARBUTHNOT'S computation. And yet APPIAN says, that he extracted his account from the public records; and he was himself a native of ALEXANDRIA.
From these principles we may learn what judgment we ought to form of those numberless bars, obstructions, and imposts, which all nations of EUROPE, and none more than ENGLAND, have put upon trade; from an exorbitant desire of amassing money, which never will heap up beyond its level, while it circulates; or from an ill-grounded apprehension of losing their specie, which never will sink below it. Could any thing scatter our riches, it would be such impolitic contrivances. But this general ill effect, however, results from them, that they deprive neighbouring nations of that free communication and exchange which the Author of the world has intended, by giving them soils, climates, and geniuses, so different from each other.
Our modern politics embrace the only method of banishing money, the using of paper-credit; they reject the only method of amassing it, the practice of hoarding; and they adopt a hundred contrivances, which serve to no purpose but to check industry, and rob ourselves and our neighbours of the common benefits of art and nature.
All taxes, however, upon foreign commodities, are not to be regarded as prejudicial or useless, but those only which are founded on the jealousy above-mentioned. A tax on GERMAN linen encourages home manufactures, and thereby multiplies our people and industry. A tax on brandy encreases the sale of rum, and supports our southern colonies. And as it is necessary, that imposts should be levied, for the support of government, it may be thought more convenient to lay them on foreign commodities, which can easily be intercepted at the port, and subjected to the impost. We ought, however, always to remember the maxim of Dr. SWIFT, That, in the arithmetic of the customs, two and two make not four, but often make only one. It can scarcely be doubted, but if the duties on wine were lowered to a third, they would yield much more to the government than at present: Our people might thereby afford to drink commonly a better and more wholesome liquor; and no prejudice would ensue to the balance of trade, of which we are so jealous. The manufacture of ale beyond the agriculture is but inconsiderable, and gives employment to few hands. The transport of wine and corn would not be much inferior.
But are there not frequent instances, you will say, of states and kingdoms, which were formerly rich and opulent, and are now poor and beggarly? Has not the money left them, with which they formerly abounded? I answer, If they lose their trade, industry, and people, they cannot expect to keep their gold and silver: For these precious metals will hold proportion to the former advantages. When LISBON and AMSTERDAM got the EAST-INDIA trade from VENICE and GENOA, they also got the profits and money which arose from it. Where the seat of government is transferred, where expensive armies are maintained at a distance, where great funds are possessed by foreigners; there naturally follows from these causes a diminution of the specie. But these, we may observe, are violent and forcible methods of carrying away money, and are in time commonly attended with the transport of people and industry. But where these remain, and the drain is not continued, the money always finds its way back again, by a hundred canals, of which we have no notion or suspicion. What immense treasures have been spent, by so many nations, in FLANDERS, since the revolution, in the course of three long wars? More money perhaps than the half of what is at present in EUROPE. But what has now become of it? Is it in the narrow compass of the AUSTRIAN provinces? No, surely: It has most of it returned to the several countries whence it came, and has followed that art and industry, by which at first it was acquired. iFor above a thousand years, the money of EUROPE has been flowing to ROME, by an open and sensible current; but it has been emptied by many secret and insensible canals: And the want of industry and commerce renders at present the papal dominions the poorest territory in all ITALY.
In short, a government has great reason to preserve with care its people and its manufactures. Its money, it may safely trust to the course of human affairs, without fear or jealousy. Or if it ever give attention to this latter circumstance, it ought only to be so far as it affects the former.
Notes for this chapter
PLUT. De Curiositate. [Plutarch, Moralia, "On Curiosity," sec. 16.]
[Edward III was king of England from 1327 to 1377.]
[In this essay and the next, Hume combats the suspicious fear or "jealousy" of free trade that mercantilism had helped to promote. This essay seeks to allay the fear that an imbalance of imports over exports will deplete a nation's supply of gold and silver money. Hume develops a "general theory" according to which money bears a regular proportion to the industry and commodities of each nation. In the natural course of things, this level will be preserved; and a nation's attempts to hoard up a supply of money that exceeds this natural level, by trade barriers and restrictions on the circulation of money, are ineffectual and, at worst, destructive. Hume does concede at the end of this essay that protective tariffs may sometimes be beneficial, but generally his writings condemn domestic market restrictions. See Rotwein, David Hume: Writings on Economics, pp. lxxii-lxxxi.]
[Joshua Gee, The Trade and Navigation of Great-Britain Considered (1729). The subtitle reads in part: "That the surest Way for a Nation to increase in Riches, is to prevent the Importation of such Foreign Commodities as may be rais'd at Home."]
[Jonathan Swift, A Short View of the State of Ireland (1727-28).]
[The period from 1100 to 1553.]
There is another cause, though more limited in its operation, which checks the wrong balance of trade, to every particular nation to which the kingdom trades. When we import more goods than we export, the exchange turns against us, and this becomes a new encouragement to export; as much as the charge of carriage and insurance of the money which becomes due would amount to. For the exchange can never rise but a little higher than that sum.
[The English, Dutch, French, and Portuguese East India companies dominated trade between Europe and the Orient. The chief imports were pepper and other spices, tea, coffee, and silk and cotton textiles. Since demand in the East for European products was far from sufficient to pay for all that Europeans wanted to buy, silver coin and bullion became the principal European export. This drain of specie to the East, which Hume speaks of below, was a matter of concern to the European states.]
[The Heptarchy is a term applied to the independent Anglo-Saxon kingdoms of England of the fifth to the ninth centuries.]
Les interets d' ANGLETERRE mal-entendus. [Jean Baptiste Dubos, Les interests de l'Angleterre mal-entendus dans la présente guerre (England's interests mistaken in the present war), 1703. The River Tweed forms part of the boundary between Scotland and England.]
It must carefully be remarked, that throughout this discourse, wherever I speak of the level of money, I mean always its proportional level to the commodities, labour, industry, and skill, which is in the several states. And I assert, that where these advantages are double, triple, quadruple, to what they are in the neighbouring states, the money infallibly will also be double, triple, quadruple. The only circumstance that can obstruct the exactness of these proportions, is the expence of transporting the commodities from one place to another; and this expence is sometimes unequal. Thus the corn, cattle, cheese, butter, of DERBYSHIRE, cannot draw the money of LONDON, so much as the manufactures of LONDON draw the money of DERBYSHIRE. But this objection is only a seeming one: For so far as the transport of commodities is expensive, so far is the communication between the places obstructed and imperfect.
[Sébastien Le Prestre, Seigneur de Vauban (1633-1707), Projet d'une dixme royale (1707; translated as A Project for a Royal Tythe or General Tax (1708). Vauban, a great military engineer and marshal of France, wrote also on the art of fortifying, attacking, and defending towns.]
We observed in Essay III. ["Of Money"] that money, when encreasing, gives encouragement to industry, during the interval between the encrease of money and rise of the prices. A good effect of this nature may follow too from paper-credit; but it is dangerous to precipitate matters, at the risk of losing all by the failing of that credit, as must happen upon any violent shock in public affairs.
[See Plutarch, Lives, in the life of Lycurgus, sec. 9. Lycurgus, the law-giver of Sparta, ordained the use of iron money instead of gold and silver and gave only a trifling value to a great weight and mass of this, so as to make its concealment difficult.]
THUCYDIDES, lib. ii.  and DIOD. SIC. lib. xii. [40.]
Vid. ÆSCHINIS et DEMOSTHENIS Epist. [Aeschines (397?-322? B.C.), The Speech on the Embassy, sec. 175; Demosthenes, Third Olynthiac Oration, sec. 24.]
TITI LIVII, lib. xlv. cap. 40. [Philip V was king of Macedon from 221 to 179 B.C. Perseus, his successor, ruled from 179 to 168. Hume refers to the thirty years from Philip's peace settlement with Rome (197 B.C.) to Perseus's defeat at the hands of Lucius Aemilius Paullus in 168. The texts cited in this note and the three that follow are referring to the huge treasure that was borne in the triumphal procession of Paullus, which was celebrated in 167 B.C. following his victory over Perseus.]
VEL. PATERC. lib. i. cap. 9. [Velleius Paterculus (19? B.C.—after A.D. 30), Historiae Romanae (Roman History) 1.9.6.]
Lib. xxxiii. cap. 3. [Pliny the Elder, Natural History 33.50.]
TITI LIVII, ibid. [45.40.]
The poverty which STANIAN speaks of is only to be seen in the most mountainous cantons, where there is no commodity to bring money. And even there the people are not poorer than in the diocese of SALTSBURGH on the one hand, or SAVOY on the other. [See Abraham Stanyan, An Account of Switzerland Written in the Year 1714 (1714).]
Proem. [Appian (second century A.D.), Roman History, Preface sec. 10 in the Loeb edition. John Arbuthnot was author of Tables of the Grecian, Roman and Jewish Measures Weights and Coins (1705?), a greatly enlarged edition of which appeared in 1727 under the title Tables of Ancient Coins, Weights, and Measures.]
[See Jonathan Swift, An Answer to a Paper called A Memorial of the Poor Inhabitants, Tradesmen and Labourers of the Kingdom of Ireland (1728): "But I will tell you a Secret, which I learned many Years ago from the Commissioners of the Customs in London: They said, when any Commodity appeared to be taxed above a moderate Rate, the Consequence was to lessen that Branch of the Revenue by one Half; and one of those Gentlemen pleasantly told me, that the Mistake of Parliaments, on such Occasions, was owing to an Error of computing Two and Two to make Four; whereas, in the Business of laying heavy Impositions, Two and Two never made more than One; which happens by lessening the Import, and the strong Temptation of running such Goods as paid high Duties." In Herbert Davis, ed., The Prose Works of Jonathan Swift (Oxford: Blackwell, 1939-68) 12, p. 21.]
Part II, Essay VI
End of Notes
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